All Posts in Category: Childcare Rebate
We now know that we wont automatically transfer across from the Child Care Benefit to the new Child Care Subsidy. For this to happen, you must complete a Child Care Subsidy Assessment before 2 July 2018 to continue to received Child Care funding. This post has the instructions to help you do this quickly. Honestly I got it done in about 7 minutes however my husband and I have regular hours so there wasn’t anything we needed to calculate.
I updated my information in the Centrelink App, but if you log into your my.Gov.au account you will also be presented with a list of Tasks to complete.
1. I have two tasks to complete and I press the Task button and swipe to the Child Care Subsidy assessment.
2. There are four tasks that need to be completed
3. The first task asks for your estimated income in the 2018-19 financial year. Complete this in the exactly the same way you have done each year that you have accessed the Childcare Benefit. Add together any salary, fringe benefits tax, child support etc. You could estimate this amount, but I would give this some serious consideration if you think that your family could be near the amount of $186,958. Family income over this amount is subject to a cap each year. For the 2018/19 year it has been indexed up to $10,190.
4. You then need to put in an estimate of the number of hours a fortnight that you and your partner meet the Activity Test, for a full list of Activities you can include refer to this post, but the main items you count hours for are:
- Paid Work – including maternity or paternity leave, long service leave and annual leave
- Unpaid internship or work experience
- Setting up a business
- Unpaid work in a family business
- Looking for work
- Caring for a child or adult with a disability
If you are in casual work – and therefore the number of hours you perform a work activity is different each fortnight, you will be asked to estimate the highest number of hours you expect to work in any fortnight over a three month period. This is the part that may take the most time to calculate.
I used the current date as a start date.
You can add a new Activity Test for each different activity you perform each fortnight. Just use the plus sign at the bottom.
5. Review the school details of each child that you have currently enrolled for Childcare Benefit. If your child is not yet at school then select none. Otherwise select Primary Education is they are enrolled at school.
6. Confirm all your information and you will receive a Claim ID.
If you want the easy explanation about all the new changes, I have prepared The Child Care Subsidy Solution. A simple, straight forward FREE ebook that shows you how the new Subsidy works and what you could do to increase your Subsidy. Download your copy by entering your details below.
(This post is now out of date, the Child Care Rebate ended on 1 July 2018 and was replaced by the Child Care Subsidy. Information on the CCS can be found here.)
It’s half way through April now and you’re wondering why has my child care rebate stopped? Aha. Hands up who has maxed out their $7,500 Childcare rebate? But you’re doing the happy dance now that the new laws have gotten rid of the $7,500 Cap? Yes?
That doesn’t start until 1 July 2018 which means that you have an ENTIRE financial year to go until we move onto the new Childcare Subsidy from the system we have now.
So it’s full fees for some of us now until 30 June. Did you know that if you also receive the Childcare Benefit, Centrelink actually withholds the final 15% of your $7,500 until you submit your tax return after 30 June? That means that you stop receiving the Childcare Rebate each financial year when you reach a cap of $6,375 and the remaining $1,125 may or may not be refunded with your tax return.
Why do they do this?
Well it does make sense from Centrelinks’ point of view. The amount you receive for Childcare Benefit is based on an estimate you make at the start of the year of how much you think you will earn. If you underestimate, Centrelink will overpay you during the year and they will want their money back. They get their money back from the $1,125 that they hold back. The only way they know if you have been overpaid is when you do your tax return. Then your estimate becomes the actual and they know for sure if you have been overpaid – or hopefully underpaid.
I have a task for you this week. Get the statements you receive from your childcare centre. At the very bottom of your statement it will tell you how much of Childcare Rebate you have received this year. Make sure it’s what you expect it to be and that it matches the balance from Centrelink. The reason I want you to do this is because of something that happened to me last month.
I don’t receive the Childcare Benefit. When I applied all the way back in 2011, I ticked the box that said I wanted a percentage of 0%. There was never EVER going to be a chance of any over payment by doing that. I’m an accountant – it’s my job to be conservative!
So when I stopped receiving my Childcare Rebate last month I checked my statement from childcare and it said that I had received $6,375. This didn’t seem right to me as I know the last 15% shouldn’t be withheld from me as I don’t receive the Childcare Benefit.
Then I checked the Centrelink App which showed that in the previous week I had been allocated to receive Childcare Rebate, however on the statement from my childcare centre, it had not been applied. There was a mismatch and it was costing me money!
The issue turned out to be in the software that the childcare centre uses and it was all fixed and I received a credit. The reason that I want you to do this double check is that according to Centrelink I had received the money, but it was not being passed on to me by the centre. As a result, when all the year end balances will be done with my tax return it will not be refunded to me and I would have been out of pocket forever.
It’s tips similar to this one that are included all throughout my instruction manual Your Family Budget. I don’t just tell you what to do and what it all means, but more than that, I actually give you information that makes it relevant for your situation, whether you are applying for Paid Parental leave or Childcare Payments. Save yourself the stress and the wasted hours of time and download Your Family Budget today.
Malcolm Turnbull announced in a speech last week that he intends to introduce changes to Childcare funding as soon as parliament resumes. I understand that this will happen next week. If it does pass through parliament early this year, as hoped by the government, it will start at the intended date of 1 July 2018. I have written in the past in detail what those changes will be and you can read my detailed explanation here.
We are well over due a change. I have calculated that my childcare fees have increased by 57% from 2011 when my eldest started long day care to now with my youngest. However there have been no changes AT ALL to the Childcare Rebate cap of $7,500. In 2011 I did not reach the cap with three days a week of childcare, now in 2017 I will reach it at around 10 months into the financial year. This is for the same level of care and probably with our carers receiving similar salaries. Not impressed.
So what is stopping parliament from passing the legislation that will approve these changes? These changes were first introduced in 2013 so what is taking so long? It is that in order to put an extra $3 billion into Childcare funding, the government wants to raid another Family Benefit. Simply, to increase funding for Childcare payments, the government is planning to reduce funding for Family Tax Benefit and this is creating a lot of push back from those that hold the balance of power in our parliament.
And so we remain at a standstill. Again.
It will be interesting to see what the government will be willing to negotiate in order to see these changes implemented. As usual, I’ll keep you updated.
If you are still unsure of how you can take advantage of the current Childcare funding arrangements, my guidebook Your Family Budget tells you how to set up your arrangements to ensure you don’t have to repay Centrelink at the end of the year. Also it includes details of the best way to receive your payments for your situation plus simple calculations that will help you determine how long it will take for you to reach your Childcare Rebate cap of $7,500. You can purchase and quickly download Your Family Budget here.
Do you use Centrelink’s phone Apps?
Personally I prefer them over logging into myGov all the time from my computer. Currently there are two apps that are pretty much doing to same thing:
- Express Plus Families App
- Express Plus Centrelink App
Centrelink have announced recently that the Families App will be retired on 26 September.
If this is the only App you currently use then I would encourage you to now download the Centrelink App. If you log into the old App you will actually be prompted to download the new Centrelink App.
Also, I found it easily in the App Store on my iphone by searching for ‘Centrelink.’ It is also on Google Play, but not the Microsoft Windows Store. Your PIN will remain the same in the new App, but if you have been using the Vault feature to store documents, these will disappear unless you email or print them.
What do I use the most on the Centrelink App?
- Locating CRN numbers
If you tap on ‘Personal’ it will bring up your basic information such as Date of Birth, YOUR CRN and also your CAN. It also tells you what payments you are approved for. An approval for ‘CCB for Approved Care’ means you are also receiving the CCR. If you tap on ‘My Family’ it will list your children that have been included in a Centrelink registration and it will include their Date of Birth and CRN.
- Looking up how much of the Childcare Rebate I have used
If you tap on ‘Menu’ and ‘Childcare’ you will see everything that is relevant to your CCB/CCR with each child. A summary of how much CCB and CCR they have received in the current financial year, your CCB percentage and a weekly summary of your child’s attendance at childcare with the fees for that week.
Your Family Budget eBook – Making Sense of Government Parenting and Childcare Payments.
My guide to everything you will ever need to apply for and understand Parental Leave Pay, Dad and Partner Pay, Childcare Benefit & Childcare Rebate. All in one place, with easy explanations.
The Government introduced Jobs for Families Child Care Package on 2 July 2018. It was one of the biggest changes in many years to the Child Care funding system and replaced the old Child Care Benefit and Child Care Rebate with the new Child Care Subsidy.
This post has been updated to include the latest rates and information as at 1 July 2019.
The following is a summary of the changes that was written before their introduction. I update this post every year with the new child care subsidy rates to ensure that it is still relevant. If you would like further explanation then you can download the free Child Care Subsidy Solution eBook using the details at the bottom of the this post.
What are the Changes to Child Care and how will it affect you?
Here is a reminder of what this package is going to offer:
1. The Childcare Benefit and Childcare Rebate will disappear and be replaced with one Child Care Subsidy.
2. It is means tested. Here are the combined family income rates:
|Combined family income^||Subsidy rate*|
|Up to $68,163||85%|
|Over $68,163 to under $173,163||Gradually reducing to 50%|
|$173,163 to under $252,453||50%|
|$252,453 to under $342,453||Gradually reducing to 20%|
|$342,453 to under $352,453||20%|
|$352,453 or more||0%|
3. Notice that it is up to a percentage of an hourly fee cap – not a percentage of the actual rate you pay if your fees are higher than these rates. This is the same system as the current Childcare Benefit standard hourly rate. Currently at $4.30 an hour.*Subsidy tapers down by 1 per cent for each $3000 of family income
When the subsidy commences the child care subsidy hourly rate cap will be:
|Service type||Maximum hourly fee cap|
|Centre Based Long Day Care||$11.98|
|Family Day Care||$11.10|
|Outside School Hours Care||$10.48|
4. For families earning more than $188,163, an annual child care subsidy cap of $10,373per child will apply, similar to the cap of $7,613 we have now.
5. All of these rates will be adjusted for CPI so when 1 July rolls around each year they will be slightly higher.
6. You need to be performing an ‘activity’ to be eligible for the Childcare Subsidy, this can include paid work, self employed work, unpaid work in a family business, looking for work, volunteering or studying.
7. It is the number of hours of that ‘activity’ you perform that gives you a corresponding number of hours of Childcare Subsidy. The Centrelink Child Care Subsidy Activity Test is:
|Hours of activity (per fortnight)||Maximum number of hours of subsidy (per fortnight)|
|8 hours to 16 hours||36 hours|
|More than 16 hours to 48 hours||72 hours|
|More than 48 hours||100 hours|
It looks like the Hours of Activity will relate to the parent with the lower number of hours. So if your family has a stay at home parent that works less than 8 hours, your family wont be able to access the new Childcare Subsidy. The exception is if your Combined Family Income is less than $68,163. Then you will be able to access 24 hours a fortnight.
If you want more detailed information on the childcare subsidy activity test, including what the activities are you can find that here. This includes child care subsidy unpaid maternity leave.
Edit: The Bill was passed by the parliament on 9 February 2017. I have made minor updates to this blog post to reflect this and any other rate changes.
p.s. If you want detailed information on the items listed above, then download the Childcare Subsidy Solution and work out ways that you can increase and decrease your Subsidy based on the amount that you earn and work.