WINZ Funeral Grant: A Complete Guide to Costs, Eligibility, and 2025 Updates

Losing a loved one is an emotionally taxing experience, often compounded by the immediate pressure of financial logistics. In New Zealand, the WINZ Funeral Grant serves as a critical safety net for families who may struggle to meet the rising costs of a dignified farewell. However, navigating the bureaucracy of Work and Income (MSD) during a time of grief can feel overwhelming.

As we move into 2025, understanding the specific thresholds, "reasonable expenses," and the reality of the New Zealand funeral market is essential. This guide provides a comprehensive breakdown of how the grant works, what it covers, and practical strategies to manage the significant "funding gap" that most Kiwi families face.

What is the WINZ Funeral Grant?

The WINZ Funeral Grant is a lump-sum payment intended to help cover the "essential" costs of a funeral. Unlike a loan, this grant does not generally need to be repaid, provided the applicant meets the eligibility criteria at the time of payment. It is designed for those who have limited assets and income and cannot afford to pay for the funeral themselves.

As of April 1, 2025, the maximum amount available is $2,616.12. This figure is adjusted annually to account for inflation, yet it remains significantly lower than the actual market rates for most funeral services in New Zealand.

Eligibility Criteria for 2025–2026

The most common reason for a grant being declined is failing the means test. WINZ evaluates the financial position of both the deceased and their surviving family members.

Income Thresholds

To qualify for the full or partial grant, the surviving partner (or the parents, if the deceased was a child) must fall under specific annual income limits. For 2025, these limits are:

• Single person (18+): Under $37,360.96 per year before tax.
• Parent with 2+ children: Under $47,764.08 per year before tax.

Asset Testing

The asset test is often where applications become complicated. WINZ considers the assets of the deceased and their surviving partner.

• Surviving Partner’s Assets: Generally, if a surviving partner has more than $2,230.96 in accessible assets (cash, savings, shares), the grant may be reduced or denied.
• The Deceased’s Assets: Any money left in the deceased’s bank account is considered available to pay for the funeral, even if the account is currently frozen by the bank.

Typical Costs and the "Funding Gap"

In New Zealand, the cost of a funeral varies wildly depending on the region and the type of service chosen. When compared to the maximum grant of $2,616.12, the financial reality for families is stark.

As the table shows, the grant covers only a fraction of a traditional burial. This creates a "funding gap" of anywhere from $5,000 to $13,000 that the family must source elsewhere. To learn more about the specific breakdown of these fees, see our Average Funeral Cost New Zealand guide.

Real-World Example 1: The Auckland Burial

James passed away in Auckland. His family wanted a traditional burial at a local cemetery. The total bill came to $14,000, including the plot, casket, and professional fees. Because James’s widow met the income criteria, she received the maximum WINZ grant of $2,616.12. This left the family with a shortfall of over $11,000, which they had to cover through a combination of a small life insurance policy and family contributions.

What Does the Grant Actually Cover?

WINZ uses the term "reasonable expenses" to define what they will pay for. While this was historically very restrictive, 2025 guidelines have modernized slightly to reflect cultural needs in New Zealand.

Covered Expenses include:

• Casket/Coffin: A basic, dignified vessel.
• Professional Services: Embalming, body preparation, and hearse fees.
• Cremation or Burial Fees: The cost of the plot or the crematorium fee.
• Tangihanga/Catering: WINZ can now contribute toward kai (food) for a funeral service.
• Memorials: Photo tributes or video recordings of the service.

ACC vs. WINZ: The Double-Dipping Rule

It is vital to distinguish between a death by natural causes and a death by accident. New Zealand’s ACC (Accident Compensation Corporation) provides a much higher level of support for accidental deaths.

• WINZ Grant: For natural deaths (Max: ~$2,616).
• ACC Funeral Grant: For accidental deaths (2025 Max: ~$7,491 – $7,990).

Real-World Example 2: The Accidental Death Trap

Sarah’s father passed away in a car accident. The family initially applied for a WINZ grant because they needed immediate funds. They received $2,616. Later, ACC approved the claim for an accidental death grant of $7,800. The family was required to repay the $2,616 to WINZ, with the remainder of the ACC funds used to settle the funeral director's bill.

Expert Recommendations for Managing Costs

Since the grant rarely covers the full cost, families must be proactive in managing expenses. As a Bereavement Services Coordinator, I recommend several strategies:

1. Consider "Direct Cremation"

This is the most budget-friendly option in NZ. It involves the cremation of the body without a formal ceremony at the crematorium. This allows the family to hold a private memorial service at a home, park, or beach later, saving thousands in venue and professional fees. For more details on this option, read our Cremation Cost New Zealand guide.

2. Request an Itemized Quote

Under no circumstances should you agree to a "package deal" without seeing the breakdown. Many funeral directors include a "Professional Services Fee" which can range from $3,000 to $6,000. You are entitled to ask what this covers and if certain tasks (like transporting the body or managing the death registration) can be handled by the family to reduce fees.

3. Regional Price Shopping

Cemetery fees are set by local councils and vary significantly. A burial plot in a rural Waikato cemetery might be $1,200, whereas a plot in a premium Auckland cemetery can exceed $8,000. If the family has ties to a more rural region, it may be significantly cheaper to hold the burial there.

4. DIY Elements

In New Zealand, you are not legally required to use a funeral director. While they provide invaluable support, a family can legally build a casket, transport the deceased in a private vehicle (provided they have the necessary permits), and host the entire service at home.

Common Mistakes to Avoid

1. Waiting for the Death Certificate: You do not need the formal death certificate to start a WINZ application. A "Funeral Director’s Confirmation" or even a newspaper death notice is often enough to begin the process.
2. The Prepaid Funeral Trap: Some people believe that putting $10,000 into a prepaid funeral plan protects those funds from asset testing. While this is true for the Residential Care Subsidy, if that plan covers the "essential costs," WINZ may view the funeral as already "paid for" and deny the grant.
3. Ignoring the Bank Account: Even if a bank account is frozen, the balance is counted as an asset. If the deceased had $3,000 in savings, WINZ will expect that $3,000 to be used first, effectively disqualifying the family from the grant. For help with this process, see Accessing Deceased Bank Account.

Recent Trends and Updates (2025–2026)

The landscape of funeral care in NZ is shifting. Here are the three biggest trends affecting the grant and funeral costs today:

Advocacy for Grant Increases

The Funeral Directors Association of NZ (FDANZ) is currently lobbying the government to increase the grant to $7,000. They argue that the current rate has not seen a meaningful increase (outside of CPI adjustments) since 2003, leaving low-income families in significant debt.

Rising Crematoria Costs

Due to gas price hikes of 20–40% across the country, crematorium fees have risen sharply in 2024 and 2025. This has led to a surge in interest for Natural Burials and Water Cremation (Aquamation).

Sustainable Alternatives

Water cremation, or alkaline hydrolysis, is now available in regions like Christchurch. It is often marketed as a more sustainable and sometimes more affordable alternative to traditional fire-based cremation. You can learn more about this process in our guide to Aquamation Explained.

Conclusion

The WINZ Funeral Grant is a vital resource, but it is rarely enough to cover the total cost of a modern New Zealand funeral. With a maximum payment of $2,616.12 against an average burial cost of $10,000, families must be prepared to make informed choices.

By understanding the means test, distinguishing between WINZ and ACC, and considering budget-friendly options like direct cremation or DIY elements, you can provide a meaningful farewell without incurring unmanageable debt. Always remember to request an itemized quote and check regional cemetery prices to make the grant go as far as possible.