The Child Care Subsidy, Simplified

The Child Care Subsidy, Simplified

The Government Child Care Subsidy makes early learning more affordable for many Australians – however, it’s not always easy to understand, especially with all the factors that need to be taken into account 

If you’re confused or seeking further explanation on the subsidy, the below guide is provided to help break down the benefits for you and your family.  

Still have questions? Our Family Support Team is ready to chat about how you can maximise your child care subsidy at a World of Learning centre – simply call us on 1800 314 517.

The factors

The Child Care Subsidy works on three factors:  

  1. How much ‘work-related’ activity you and your partner undertake each fortnight. This includes paid work, volunteering, study and other activities as determined by education.gov.au, such as travelling between the child care service and your place of home, work or other. 
  2. Your total combined family income. 
  3. The service type – this will be centre-based care such as long day care, or outside-hours care such as vacation care.  

You can click here to find a breakdown of the subsidy based on your combined family income, plus further explanation of the types of approved activities.

Applying for CCS 

The best way to apply for CCS is through your MyGov Account that is linked to Centrelink.  

  • Sign in to MyGov and go to Centrelink. 
  • Select Payment and Claims from the menu, then Claims, then Make a Claim. 
  • Under Families, select Get Started. 
  • Answer all the questions. Each screen has information to help you complete the claim. This includes how to submit your supporting documents. 
  • Submit your claim. You can track the progress of your claim online. 

Our top tips 

  • Use our handy Subsidy Calculator to get an estimate of how much you could expect to receive – simply click here.
  •  Apply for CCS as soon as you find a centre that you and your child are happy with. This way, it’ll be set up and ready to go for your child’s first day of care. If it’s not set up, you may be paying full fees until it’s all complete. 
  • Confirm your Complying Written Agreement (CWA). This needs to be done before your child starts at the centre, or the first day that your child starts care. If it is not done before they start, CCS will not be applied for those days.  
  • Go into your MyGov and confirm your child’s enrolment. CCS is paid directly to the childcare centre that your child is attending. 

Helping to work out your out-of-pocket payment

To try calculating your out-of-pocket fee, take a look at the formula below…  

The centre’s day fee divided by hours of session (could be 9hrs, 10hrs or 12hrs) = Your hourly fee 

CCS hourly cap is $11.98^  

 

Hourly fee (or CCS cap if the hourly fee is over CCS cap) x hours of care per fortnight =  

Hourly fee – 11.98 (CCS hourly cap) = B 

B X total fortnightly session hours = C 

A x Family subsidy % = D 

D x 0.95 (5% withheld by government) [only if needed] = E 

A – D or E if 5% withheld) + C = Your Out of Pocket payment per fortnight 

^ This amount is correct for centre based care for 2018/19 and may be subject to adjustment through indexation in subsequent years.

Case study example: The John family

The John family will be sending Sally to an early education centre for 8 days per fortnight, 10 hours per day, resulting in 80 hours of care per fortnight 

Based on their combined family income and their activity, their subsidy is 85% with 100 hours per fortnight. The centre’s daily fee is $120. 

The maths:

 $120 (full day fee) ÷ 10 (session hours) = $12 hourly fee.  

The CCS hourly cap is $11.98. 

(Hourly cap) 11.98 x (hours of care) 80 = $958.40 

$12 (Hourly fee) – 11.98 (CCS hourly cap) = $0.02 

$0.02 x 80 hours = $1.60 

(Family subsidy percentage) 85% x $958.40 $814.64 

5% (withheld by Government) 0.95 x $814.64 $773.908    

$958.40 – $773.91 $1.60 $186.09 out of pocket payment per fortnight 

 

Why does the 9-hour day sometimes work out more expensive than the 10-hour day?  

The simple answer is, it comes down to the hourly cap.   

If a centre’s daily fee, divided by 9, is over the hourly cap ($11.98) – this leaves a gap each hour that does not receive any Child Care percentage. This then accumulates a gap that is added on to the subsidized amount.

Still working out your subsidy benefits? Our Family Support Team is ready to help – simply call us on 1800 314 517.

Leave a Reply

Your email address will not be published. Required fields are marked *