From 2 July 2018, Child Care Subsidy replaced Child Care Rebate and Child Care Benefits. The new subsidy is income tested and may result in more or less of your child care costs being paid, depending on if you meet the set requirements as outlined below.
The Child Care Subsidy is aimed at providing families with a simpler process. Eligibility for the Child Care Subsidy is based on the following:
- The age of your child (must be 13 or under and not attending secondary school),
- Must meet immunisation requirements for your child,
- The parents or other eligible individual must meet the residency requirements listed in the legislation.
Please also note: that the parents or caregivers must be liable to pay for care provided and delivered here in Australia by an approved child care provider and not a compulsory education program. Once it's been concluded that you meet the above eligibility, you will then be tested on three factors that identify a family's level of subsidy.
The three factors are:
- Combined Family Income,
- Activity Test - the activity level of both parents (eg work, study or volunteering),
- Service Test - type of child care service (different hourly rate caps apply to different types of cover).
The percentage of subsidy a family will be entitled to is determined on your combined annual income as shown in the table below.
You can still claim this subsidy even if your family income estimate is $352,453 or more. If you actually earn less than this, they'll pay you the subsidy you're entitled to. They do this when they balance your payments a the end of the financial year.
^ NOTE: your Child Care Subsidy percentage is the amount they'll subsidies. It will apply to either your hourly fee or the relevant hourly rate cap (whichever is lower).
If your families earning $188,163 per year, you won't be subject to a cap on the amount of Child Care Subsidy they can access. Families earning between $188,163 and $352,453 will still have an annual cap which will increase to $10,373 per year per child.
Now is a good time to consider your estate plan. It's an important part of your overall financial plan to protect the wealth you have accumulated for the benefit of your family.
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The information provided in this information sheet does not constitute advice. The information is of a general nature only and does not take into account your individual financial situation. It should not be used, relied upon, or treated as a substitute for specific professional advice. We recommend that you contact Brentnalls SA before making any decision to discuss your particular requirements or circumstances.