What is the Child Care Subsidy?

The Child Care Subsidy is the main way the Government assists families to pay for the cost of childcare.

If you and your family are affected by COVID-19, you may be eligible for additional payments. Visit the Services Australia website for more information.

The Child Care Subsidy replaced the Child Care Benefit and Child Care Rebate in 2018. The subsidy is designed to be simpler, to make childcare affordable for more families, and to provide more help to low and middle-income families.

The Child Care Subsidy is only paid for approved child care, which is:

• centre-based day care, including long day care and occasional care
• family day care
• outside school hours care, including before, after and vacation care
• in home care

The Child Care Subsidy is not paid for registered care, which is care by grandparents or other relatives, or in a standalone preschool or kindergarten. Your childcare service can tell you which sort of care they provide. The Child Care Finder website can help you find approved care in your area.

The Child Care Subsidy is worked out according to your family’s income, the hourly rate cap on the type of approved child care you use, your child’s age, and the hours of activity you and your partner do. You can estimate how much Child Care Subsidy you may get on the Services Australia website.

The Child Care Subsidy is paid directly to the childcare service. The service will then reduce your fees — you just pay the difference between the amount the service charges and the amount paid by the subsidy.

There is also a Child Care Safety Net to provide extra payments for disadvantaged families and children. For more information, visit the Department of Education, Skills and Employment website.

How much will the Child Care Subsidy pay?

The amount of the subsidy will depend on your circumstances:

• your combined family income (you will need to do a means test)
• how many hours per week each parent spends doing activities such as paid work, training, volunteering or looking for work
• the type of childcare service (long day care, occasional care, family day care or outside school hours care)

Families earning up to $70,015 will receive a subsidy of 85% of the actual fee charged. Families earning between $70,015and $354,305 will receive a progressively lower percentage, depending on how much they earn. The hourly fee will be capped depending on the type of service.

For most families (those earning $190,015 or less), there is no longer an annual cap on the amount of subsidy they can receive. There is an increased annual cap for families earning more than that amount.

Am I eligible for the Child Care Subsidy?

You can receive the Child Care Subsidy for a child if:

• the child is 13 or under and not attending secondary school
• the child is immunised
• you, or your partner, meet the residency requirements
• you are responsible for paying the childcare fees

You can check your eligibility on the Services Australia website.

Additional Child Care Subsidy payments

You may also be eligible for an Additional Child Care Subsidy to help with the cost of approved care if you are:

• an eligible grandparent getting an income support payment
• transitioning from certain income support payments to work
• experiencing temporary financial hardship
• caring for a child who is vulnerable or at risk of harm, abuse or neglect

Read more about the Additional Child Care Subsidy on the Services Australia website.

Read more about the Child Care Package.