CCS Balancing - It's happening now

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  Published on Tuesday, 13 August 2019

CCS Balancing - It's happening now

Library Home  >  Cost of CareGovernment Policy & Quality Standards
  Published on Tuesday, 13 August 2019

The Child Care Subsidy (CCS) balancing process, also known as reconciliation, for the 2018–19 financial year began on 29 July. Here's the Department of Education lowdown on what early childhood education and care providers need to know and, more importantly, what they need to do:

What is 'Balancing'?

Balancing, also referred to as 'income review' or 'reconciliation', is the process that occurs after the end of each financial year where Services Australia compares families' income estimates with their actual adjusted taxable income to ensure families receive their correct Child Care Subsidy (CCS) entitlement.

You can learn more about the CCS balancing process in this DHS video.

Balancing is not new and the process for CCS will be similar to previous years for most families who have previously used subsidised child care.

For some families, however, this may be the first time they will be part of the balancing process and if you are asked for information you can suggest parents and carers view the DHS information on the balancing process for families.

When will CCS balancing happen?

DHS started balancing CCS payments for the 2018–19 financial year on 29 July 2019, remember DHS can only reconcile a family's CCS payments after they lodge their tax return, or tell DHS they do not need to lodge a tax return, which means the process can take some time to complete.

What do families need to do?

Families will need to take action so DHS can balance their CCS. They will need to either:

  • lodge a tax return(s), or
  • tell DHS that they are not required to lodge a tax return.

More information for families is available on the DHS website.

What are the possible outcomes of balancing for a family?

Once DHS has compared a family's income estimate with their actual adjusted taxable income, DHS will advise them of their balancing outcome in a letter, or if the family receives letters electronically, the letter will be sent to their myGov inbox.

When DHS balances a family's payments, there are three possible outcomes that will be outlined in the letter. This is a normal part of the balancing process.

  1. For some families, there won't be any further action for them, if they received the correct amount of CCS during the year.
  2. Some families may not have been paid enough CCS during the year. If this happens, they'll be paid any outstanding amounts directly when DHS balances their payments. DHS call this a 'top up' payment.
  3. Other families may have been paid too much CCS during the year. If this happens, families may owe money, which they have to pay back to DHS. DHS may recover overpayments of CCS from future CCS, Family Tax Benefit (FTB) payments (including arrears), FTB top ups and supplements as well as tax refunds.

It is important that families talk to DHS if they have questions about paying back an overpayment. DHS can work with families to set up a repayment plan. CCS payments will not be used to recover debts for other payments, such as FTB or Parenting Payment.

If providers and services receive questions from families, there is more information on the DHS website to help families understand the balancing process.

What changes may providers and services experience as a result of balancing?

Similar to previous years, balancing child care fee assistance payments occur between families and DHS.

Providers and services may notice a change to the amount of CCS received on behalf of a family after DHS completes the balancing process. For example, if a family owes DHS money after balancing has occurred, the family may choose to reduce their future CCS payments to repay monies owed. This is called an offset.

The amount of CCS providers and services receive on behalf of families may also change throughout the year for a number of reasons. Examples include a family:

  • notifying a change in their circumstances, such as a change in income, level of recognised activity or a change in relationship status
  • choosing to change the percentage of withholding.

Did you know families can change their withholding amount?

DHS withholds 5 per cent of a family's entitlement to CCS throughout the financial year. If a family has been paid too much CCS, the amount withheld during the year will reduce the amount they owe at the end of a financial year.

Families can choose to change their withholding percentage online up to twice a year. More information on withholding is available on the DHS factsheet.

Need more info?

The Department of Education and DHS have developed resources early childhood providers can share with families to help them understand the balancing process.

While these resources are there to help families, providers and services are not expected to answer questions families have about balancing their payments.

Families who need more information to understand the balancing process should be directed to the DHS website.

Resource You can…
Information sheet distribute this article to families who attend your service.
Self-print poster – Balancing CCS display this poster at your service.
Self-print poster – Family Update display this poster at your service.
Video – Balancing CCS share this video with families who attend your service.
Picture- the balancing journey share this image with families who attend your service.

For more information about CCS Balancing, click here.

This child care article was last reviewed or updated on Tuesday, 22 September 2020