Child care subsidies - an overview

Child care subsidies - an overview

The Federal Government subsidises some of the costs of child care. For a summary of the available subsidies see the list below, you can access more detailed information by clicking the name of the subsidy you are interested in.

Child Care Subsidy – from 2 July 2018

In July next year the current Child Care Benefit and Child Care Rebate will be replaced by a single means-tested Child Care Subsidy for families using early childhood services.

The single subsidy will be paid directly to providers and passed on to families as a fee reduction. Families will have to pay the gap between what the subsidy costs and what the provider charges.

Under the new means tested system families who meet an activity test and residency requirements will receive different amounts depending on their income:

  • Families earning $65,710 or less will receive a subsidy of 85 per cent of the actual fee charged (up to 85 per cent of an hourly rate cap).
  • For families earning above $65,710, the subsidy gradually decreases to 20 per cent when family income reaches $340,000
  • For families with incomes of $350,000 or more, the subsidy is zero per cent.

Existing System

Child Care Benefit (CCB) - more details

  • Paid as a lump sum at the end of the financial year or to the registered or approved child care provider as reduced fees throughout the year.
  • Can be claimed for up to 24 hours of care per child per week, or up to 50 hours if the parent(s) are studying, working or looking for work.
  • Payments are based on your family's annual income. To receive the maximum rate of CCB your combined family income must be less than $40,000 a year.
  • CCB rates reduce on a sliding scale depending on income and the number of children in care.
  • The income levels at which the payment phases out completely depends on the number of children a family has in approved care.
  • Families who are eligible for CCB who receive zero payment due to high income may still receive CCR.

Grandparent Child Care Benefit (GCCB) - more details

  • Financial assistance for grandparents who have the primary responsibility for raising a grandchild.
  • Covers the full cost of fees for children in approved child care.
  • Can be claimed for up to 50 hours of care per child per week. There is no requirement for the grandparents to be working, training or studying.

Child Care Rebate (CCR) - more details

  • Covers 50 per cent of your out-of-pocket expenses (total child care fees minus CCB) for approved child care up to a maximum of $7500 per child per year.
  • Is not currently means tested.
  • Paid directly into your bank account on a quarterly basis.

The Australian Government's Child Care Estimator can help you determine your eligibility for CCB and CCR and how much assistance you are entitled to.

For more information about the benefits visit the Department of Human Services website or call on 13 6150.

This child care article was last updated on Thursday, 14 September 2017

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