How Does the Child Care Subsidy Work? Calculator & Explainer

The cost of child care is a major expense for families, especially for larger households with multiple children attending child care. To help families who need financial assistance with managing the cost of child care, the Australian Government provides the Child Care Subsidy (CCS). 

Families eligible for the Child Care Subsidy can claim up to 90% of the cost of child care services when attending an approved centre-based child care service like Raising Stars. 

We’ve created this guide to help parents understand how Child Care Subsidy works, who is eligible, and how to make a CCS claim. 

Recent Changes to the Child Care Subsidy (CCS)

As of 8 July 2024, the family income threshold for the Child Care Subsidy has been raised to $533,280, allowing more families under this combined household income amount to access the Child Care Subsidy. 

The hourly cap on the Child Care Subsidy was also raised for both centre-based care and family day care, increasing the amount of CCS that can be claimed. Centre-based care hourly rate cap increased from $13.73 to $14.29, while the hourly rate cap for family day care increased from $12.72 to $13.24. 

On 11 December 2024, the Australian Government announced further changes to the CCS:

• All CCS-eligible families will get at least 3 days of subsidised care each week for each child, up to a maximum of 100 hours each fortnight. 
• Families of First Nations children will automatically be eligible for 100 hours of subsidised care each fortnight for each child.

These changes will provide even more financial support for families when they come into effect from 5 January 2026. 

Eligibility Requirements for the Child Care Subsidy

To be eligible for the Child Care Subsidy, families must:

• Have a combined household income under $533,280, which includes most middle income households.
• Have at least one parent or guardian with Australian citizenship or a permanent visa (other special category or temporary visas may be applicable)
• Use an approved child care provider such as Raising Stars
• Take care of the child for at least 2 nights every two weeks or have a 14% involvement in their care.

Children attending approved child care must also meet the following requirements:

• Have or be scheduled for the appropriate vaccinations under the Department of Health’s early childhood vaccination schedule 
• Be under the age of 13 years and not attending secondary school (special circumstances may apply)

To remain eligible for the Child Care Subsidy, children should attend a session at least once every 26 weeks. If your child is re-entering childcare after a break, families will need to submit a new claim for the CCS. 

How Much Child Care Subsidy Am I Eligible For?

Child Care Subsidy amounts are based on a percentage of the fees charged by the child care provider or the hourly rate cap, whichever is lower. This subsidy rate percentage is dependent on household income. 

Household income	CCS rate
$83,280 and under	90%
Between $83,281 and $533,279	Up to 90%, decreasing by 1% for every $5000 earned over $83,280.
$533,280 and over	0%

Child Care Subsidy rates are higher for families with more than one child aged 5 and under. Each child after the first, can receive up to 95% subsidy. As with the standard CCS rate, the subsidy rate for second and younger children will be adjusted based on household income.  

The subsidised care hours claimable under CCS depend on how much time primary caregivers spend on recognised activities, such as work, study, or volunteering. Parents and caregivers must have at least 8 hours of recognised activity each fortnight to be eligible for CCS, up to a maximum of 48 hours per fortnight for 100 hours of subsidised care. 

Use the child care subsidy tool below to estimate the amount of subsidy you can claim based on your circumstances. 

Guide to Claiming the Child Care Subsidy 

You can claim the Child Care Subsidy online through Services Australia – and the process is simpler than most parents expect.

1. You’ll need a Centrelink account to start the application. 

2. As part of the application process, you’ll be asked to provide supporting documentation for the Child Care Subsidy claim. These include financial details such as bank statements and payslips, proof of identity and relationships, and your tax file number. 

3. You will also need to provide details of your child’s enrolment with the approved child care centre. If your child is already enrolled, the child care centre or provider will have already submitted the details for you to confirm online. Otherwise, you may need to contact the child care provider to update the enrolment details. 

4. Once you’ve submitted the claim, you’ll receive a notice of the outcome outlining the subsidy type and percentage. 

5. Your child care provider automatically applies the Child Care Subsidy. The eligible amount will be deducted from the child care fees — you will only need to pay the outstanding amount. 

If you have other questions about the Child Care Subsidy or the claims process, our staff at Raising Stars Early Learning Centres in Five Dock, Gregory Hills, and Riverstone can help. Get in touch with us via phone call or email – we’ll be happy to provide clarity on how the Child Care Subsidy works as well as our early learning curriculum.