On the 2nd of July 2018, the new Child Care Subsidy (CCS) system came in to affect. The new Child Care Subsidy replaced Child Care Benefit (CCB) and Child Care Rebate (CCR) with a single, means-tested subsidy. Childcare Benefit Childcare Subsidy (July 2018) Childcare Rebate Child Care Subsidy is designed to provide more assistance to low and middle-income families.
Many families out of pocket cost Child Care fees have fallen between $20 – $30 per week under this new system.
Who is eligible?
Some basic requirements must be satisfied for an individual to be eligible to receive Child Care Subsidy for a child. These include:
- The child/ren must 13 years old or younger and not attending high school (some exceptions do apply)
- All children must be up to date with their immunisations
- Residency requirements must be met
- The child/ren must be attending an approved Child Care Service.
Child Care Subsidy Entitlement
There are three factors that determine a family’s level of Child Care Subsidy. These include the Combined Family Income, the Activity Test and the Type of Care that you are applying for such as long day care or family day care.
- The Combined Family Income
- The Activity Test
The number of hours of subsidised child care that families have access to per fortnight is determined by a three-step activity test.
In two parent families both parents, unless exempt, must meet the activity test. In the case where both parents meet different steps of the activity test, the parent with the lowest entitlement determines the hours of subsidised care for the child.
A broad range of activities meet the activity test requirements, including:
- Paid work, including being self-employed or on leave (including paid or unpaid parental leave)
- Doing unpaid work in the family business
- Training courses for the purpose of improving the individual’s work skills or employment prospects
- An approved course of education or study
- Unpaid work experience or internships
- Actively setting up a business
- Actively looking for work Recognised activities can be combined to determine the maximum number of hours of subsidy.
Time taken to travel between the child care service and the parents/ carers place of work, training, study, or other recognised activity can also be included.
Activity hours do not need to coincide with child care hours. For example, an individual undertaking work on the weekends is entitled to Child Care Subsidy during the week.
Low income families with a combined annual income of $66,958 or less who do not meet and are not exempt from the activity test are entitled to 24 hours of subsided care per fortnight under the Child Care Safety Net.
- The Service Type
The Child Care Subsidy (CCS) cap amount that will be applied to your account will be determined by the Service Type your child attends.
There is a different rate for Long Day care Centres and Family Day Care. These caps place an upper limit on the amount of Child Care Subsidy the Australian Government will provide. The rate cap will be used, in combination with family’s income and level of activity to calculate the amount of subsidy a family is entitled to receive.
Where a child care service charges less than the hourly cap, families will receive their applicable percentage of the actual fee charged. Where a service charges more than the relevant cap, families will receive their applicable percentage of the hourly rate cap.
There are exemptions to the activity test for individuals who legitimately cannot meet the activity test requirements, such as parents with disability and carers.
Families who do not meet and are not exempt from the activity test and have a preschool aged child who attends preschool at a centre based day care service may be entitled to 36 hours of subsidised care per fortnight. This only applies to the preschool aged child/ren in the family.
To receive this entitlement, the child needs to be in the year two years before grade one of school (based on information provided in the family’s claim) and attending an appropriate preschool program at a centre-based day care service (as reported by the family’s child care service).
Child Care Subsidy Annual Cap
Families earning $186,958 or less per year are not subject to a cap on the amount of Child Care Subsidy they can access. Families earning over $186,958 and under $351,248 have an annual cap of $10,190 per year per child.
More information can be found at: