How does the new Child Care Subsidy Impact you?
13 Jul 18
The new Child Care Subsidy (CCS) system has come into effect from the 2nd of July 2018. This has replaced the Child Care Benefit (CCB) and Child Care Rebate (CCR).
How do I get assessed for CCS?
When you get assessed for CCS there are 3 factors that are considered;
1. CCS Percentage: Your family’s combined income will calculate the CCS percentage you’re entitled to.
2. Level of activity: CCS is linked to how much a family contributes to the Australian economy through activity. This activity level is calculated from the parent with the lowest number of hours of activity.
3. Hourly Rate: Hours of activity per fortnight is assessed and this determines how many hours of eligibility.
How do I apply for CCS?
Check if you’re eligible for this subsidy before you start. Centrelink pay the subsidy directly to your child care provider to reduce the fees you pay. You need to submit a claim for Child Care Subsidy. You can claim using your Centrelink online account through myGov. For help, use the online guide to claim Child Care Subsidy.
Is there a cap?
Previously there was a cap of $7,500 per child. Now the following caps apply;
Families earning less than $186,958 combined income = no cap
Families earning $186,958 to $351,248 combined income= $10,190 cap
Families earning over $351,248 combined income = not eligible for CCS
If your income increases or decreases remember to contact Centrelink to notify them of your changes. The government will be holding back 5% of CCS paid to families until reconciliation at the end of every financial year. This balance will be paid back to families in their tax return if they are eligible.
How is activity assessed?
To receive CCS a suitable amount of “activity” is required. How much activity will also determine hours that your family is eligible for.
Activity includes the following;
- Paid work (including unpaid lunch breaks)
- Commute time from childcare centre to work (excludes time travelling from home to childcare centre and vice versa)
- Authorised leave (eg maternity leave, long service leave, annual leave etc)
- Unpaid leave of up to 6 months
- Unpaid work in a family business
- Setting up a new business
- Training and study (includes semester breaks)
- Work experience/internships (whether paid or not)
- Looking for work (eg internet research, contacting employers, preparing resumes/letters of application, preparing for and attending job interviews, travel time for interviews)
Concerned you won’t have enough activity?
There may be some families that lose the level of childcare funding support they have become used to as a result of the activity test. However, please note:
- Activity is based on the family’s estimate over a thirteen week period
- For casual/contract/itinerant workers whose hours may vary from week to week, you should pick the week with the highest level of activity in the thirteen week period and use that as your level of activity
- You can go onto myGov and change your activity level at any time
- While you do not have to verify your activity, the Government has said that it will look to audit about 10% of families each year to seek some form of verification that the activity is valid
- Families earning less than $64,710 are exempt from activity tests for up to 24 hours care per fortnight
To help families increase their hours of activity, families can volunteer at the centre – contact Sarah or Monira for more information