The Child Care Subsidy Explained

By Emma Thomas

The Child Care Subsidy can be confusing and overwhelming! And I’m saying this as someone who has worked in early childhood since I left school. Since becoming a parent I have had to navigate the system from the family side and have often been left perplexed. I sat down and had a chat with our resident expert Shantel.  

“Hi, I’m Shantel and I have worked in the early years learning sector for over a decade. I am Diploma trained and worked on the floor for 7 years starting my career as a trainee, and working my way up to Room Leader and 2IC. While I loved working directly with children, I found my passion lies in supporting families on their journey, from tours to enrolment and starting at the centre.”

 Shantel kindly shared answers to some of the common questions that she gets from families. She also gave us her top tips!

So Shantel, what is the Child Care Subsidy? 

The Child Care Subsidy comes from the federal government. It is a means tested payment that is provided to help families with the cost of childcare. The amount your family will receive depends on

  • Your income
  • How many hours you work (or engage in other approved activities)
  • Your family circumstances. 

To be eligible for CCS you need to be an Australian citizen or hold a specific visa. 

There are two parts to the Child Care Subsidy (CCS):

  1. Subsidy Percentage – For example, 85% (The percentage of care that will be paid for by Services Australia/Centrelink)
  2. Approved Hours Per Fortnight – For example, 100 hours per fortnight. (The number of hours care to which that subsidy percentage applies)


When should I apply for CCS?

Now! We recommend that you apply as soon as possible. Applications can take 6-8 weeks to be processed. You can start applying for CCS before you’ve even decided on a centre. 

Your child is able to commence care before your CCS application is approved, however you will have to pay full fees. 


What is the application process?

You should be able to complete the application process through Centrelink’s online portal. However if you have difficulties you will need to call Centrelink. 


Applying for Child Care Subsidy

  1. Sign into your MyGov Account and go to Centrelink.
  2. From the menu select ‘Payment and Claims’, ‘Claims’ and then ‘Make a claim’.
  3. Under ‘Families’ select ‘get started’.
  4. Answer all the questions.
  5. Press submit.

Find out more – https://www.servicesaustralia.gov.au/how-to-claim-child-care-subsidy?context=41186

How much will I actually be paying?

Your out of pocket costs will depend on the centre fees and how much CCS you receive. The government pays CCS directly to the centre. We will then bill you for the gap payments. We can figure out what your regular payment will be once your CCS application has been approved. 

You can try a Subsidy Calculator like this one to give you an idea of how much CCS you might receive and what your costs will be. 

Try our Child Care Subsidy Calculator today!


Why do I need to know my hourly rate?

Centrelink will ask for your centre’s hourly fee when you are completing your application. Centres provide you a daily fee which you will need to use to calculate your hourly fee 

E.g. Daily fee / number of hours = hourly rate

Centrelink sets a cap of $12.31 per hour. If your centre has a higher hourly rate than this you will pay a larger gap fee. 


Shantel’s Tips

  • Try calling Centrelink when you know other families will be busy! Your call is more likely to go through quickly first thing in the morning or during the evening dinner/bed time. 
  • The Centrelink helpline is open 8:00am-8:00pm Monday to Friday. Ph. 136 150
  • You must always let Centrelink know of any changes to your circumstances. Changes in your income or activity hours will affect how much CCS you are entitled to. If you receive too little you will get a pay out at the end of the financial year, however if you are overpaid you will have to return the money. 
  • There is a 5% withholding to reduce the chance of overpayment. This will be paid at the end of the financial year once your CCS is balanced. 
  • You can alter the amount that Centrelink withholds and use it as a saving strategy! 
  • Everything with Centrelink and the Child Care Subsidy works in fortnights! Make sure you are reporting your activity hours per fortnight as it’s easy to get mixed up.