Priority for deductions

Certain forms of deductions take priority over others; the following list gives the order of priority, highest to lowest:

Highest priority

• Child Support deductions made under the Child Support Act 1991
• Inland Revenue tax deductions
• Ministry of Social Development debt repayments including Liable Parent Contributions (LPC), child maintenance debts and Major Repairs Advances (MRA), Student Allowance debt, Student Loan debt converted to Ministry debt, Income Related Rent (historical Housing New Zealand debt), Income Related Rent (Ministry of Social Development debt)
• Attachment orders made under the Family Proceedings Act 1980
• Court attachment orders issued under the Summary Proceedings Act 1957
• Court attachment orders issued under the District Court Act 2016
• Student Loan repayments

Lowest priority

Determining the priority of deductions is necessary when a client has more than one order issued from their benefit. Also each order and deduction notice is subject to its own protected earnings rule.

When you need to reduce deductions you adjust from the lowest priority up to those with a higher priority taking into account the protected earnings rules for each.

Example

A client has both Child Support and Ministry debt deductions to be made from their benefit. When the level of Ministry debt reduces the client's benefit payments below the Child Support protected earnings rate, the Ministry debt deduction must be reduced not the Child Support payments.

This is because Child Support deductions take priority over Ministry of Social Development debt repayments.