Working out how much you will have to pay for child care is one of the most important parts of the early stages of choosing a centre for your children to attend.
Costs of care can vary widely but most families across Australia will qualify for some Government relief, with the actual amounts received depending on your family’s personal circumstances.
The following five things are essential to know as you work out precisely how much support your family is eligible to receive.
- Confirm the fees and session durations at your chosen child care centre
This may seem like a straightforward exercise but it is important to recognise that many child care services have different daily fee rates that are linked to the number of hours you expect to place your child in care for.
Some centres will have half day sessions available, some will have eight hour and some will have ten hours.
It is important to determine up front what the number of hours per day you are likely to commit to and then the associated costs of that care.
- Start to familiarise yourself with the Child Care Subsidy
This is a very important step as the Child Care Subsidy system is quite complicated and will contain a range of new concepts and terminologies that will be unfamiliar at first.
The best place to read about the basics of the child care subsidy is here at the Centrelink website Child Care Subsidy page.
It also contains a helpful video that acts as a useful primer on the subsidy.
- Confirm if you are eligible for the Child Care Subsidy
Eligibility is determined by reference to four key questions, namely:
- Do you care for a child 13 or younger who’s not attending secondary school?
- Are you responsible for paying the child care fees?
- Do you use an approved child care service?
- Do you meet residency and immunisation requirements?
The Centrelink website Child Care Subsidy page contains a range of resources to help unpack the eligibility questions.
For information on residency and immunisation requirements please click here and here.
- Start to gather the key information required to calculate your CCS entitlement
This is perhaps the most important and potentially difficult step in securing your child care subsidy.
There are three key variables that determine how much Child Care Subsidy you are entitled to receive.
- How much does your family earn?
Your family income estimate, the combined taxable income you, and your partner if you have one earn in a tax year, will determine what percentage of subsidy you will receive per hour of care used.
For example, if you and your partner together expect to earn $150,000 in the current financial year you will receive a subsidy equivalent to between 85% and 50% of the hourly costs of care incurred at your centre.
The exact number will depend on where you sit in the income bands provided by the Government.
These can be found here.
- How much are the fees at your centre?
The cost of fees at your centre is also an important input as the Government has included a mechanism that limits the payment of subsidies up to a fee cap, which for centre based care is $12.20 per hour.
So if your fees are below $12.20 per hour you will receive all of your percentage CCS allocation for each hour of care used but if your fees are over $12.20 per hour you will only receive subsidy up to the $12.20 cap and no subsidies on the portion of fees that are over the cap.
It is also important to note that there is an annual cap as to how much subsidy a family can receive. This is dependent on overall income levels, and equates to $10,560 per child per year.
For details on the annual caps see here.
- How many hours of recognised activity does your family do in a fortnight?
This is the final piece of the eligibility puzzle and requires you as a family to estimate how many hours of activity you and your partner do in a fortnight after which you will be allocated a set number of subsidised hours of care you can access per fortnight.
The range of recognised activity includes hours spent doing paid work but also a range of other items that are deemed to be recognisable. These include spending time on paid or unpaid leave, including paid or unpaid parental or maternity leave, unpaid work in a family business, unpaid work experience or unpaid internship, actively setting up a business, studying and more.
To see the full list of recognised activities see here and to understand how many hours of subsidised care you will receive for your fortnight’s activity please click here.
- Calculating your CCS subsidy entitlement
This is the last stage of the process and will require you to access a child care subsidy calculator in which you would input all of the information gathered above to get an estimate of your out of pocket child care expenses.
There are a number of calculators available on the market but the CCS Calculator on child care search platform Toddle is an excellent example of a simple and effective calculator that gives quick and accurate results but also has the added benefit of being part of a larger platform that includes details of a huge range of child care centres across Australia.
The calculator is made up of seven simple steps and takes less than 30 seconds to complete.
To use the CCS calculator please click here.
While the cost of child care may seem confusing at first, it shouldn’t take you long to determine what your out of pocket expenses will be. From there, you’ll be able to focus on getting your little one ready for their first day of child care.
