Child Care Subsidy balancing

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The Child Care Subsidy (CCS) balancing process (also known as reconciliation) is underway for the 2018‑19 and 2019‑20 financial years.

What is 'balancing'?

Balancing, also referred to as 'reconciliation', is the process that occurs after the end of each financial year where Services Australia compares families' income estimates with their actual adjusted taxable income to ensure families receive their correct Child Care Subsidy (CCS) entitlement.

This Child Care Subsidy balancing video explains how Services Australia balances CCS. Families should visit the Services Australia website for more information.

What do families need to do?

Families will need to take action so Services Australia can balance their CCS. They will need to either:

Even if a family has told the ATO they don’t need to lodge, they must still do an Advise non-lodgement of tax return with Services Australia.

2019–20 financial year

Balancing CCS for the 2019–20 financial year starts from 10 August 2020.

If Services Australia has paid a family too much during the financial year, they won’t finalise balancing the family’s payments straight away. This is because they have paused a range of debt activities due to COVID-19.

2018–19 financial year

Balancing for the 2018–19 financial year is still underway.

Some families still have not confirmed their 2018–19 income, which means they may not have received the correct CCS entitlement for the 2018–19 financial year. If a family received CCS for 2018–19 and haven’t confirmed their family income by 31 March 2021, their CCS will reduce to 0 per cent from 5 April 2021. This means families will need to be charged full fees for child care they use.

Session reports

On 9 August 2020, the Child Care Subsidy System (CCSS) will close for the 2019–20 financial year. This means providers will not be able to submit, vary or withdraw session reports for any period between 1 July 2019 and 30 June 2020.

In limited specified circumstances where a provider needs to submit, vary or withdraw session reports from the previous financial year, the provider will need to apply to the Department of Education, Skills and Employment. The Application form to amend/submit previous financial year data is available. A session reports from a previous financial year fact sheet on the process is also available.

What changes may providers and services experience as a result of balancing?

Balancing occurs between families and Services Australia.

Providers and services may notice a change to the amount of CCS received on behalf of a family after Services Australia completes the balancing process. For example, if a family owes Services Australia money after balancing has occurred, the family may choose to reduce their future CCS payments to repay what they owe. This is called an offset.

The amount of CCS providers and services receive on behalf of families may also change throughout the year for a number of reasons including changes to a family’s circumstance and eligibility. For more information, please see why the amount of CCS Services Australia pays changes.

Did you know families can change their withholding amount?

Services Australia withholds 5 per cent of a family's entitlement to CCS throughout the financial year. If a family has been paid too much CCS, the amount withheld during the year will reduce the amount they owe at the end of a financial year.

Families can choose to change their withholding percentage online up to twice a year. For more information, please see our CCS Withholding fact sheet.

Resources

The Department of Education, Skills and Employment and Services Australia have developed resources providers and services can share with families who attend their service to help them understand the process.

While these resources are there to help families, providers and services are not expected to answer questions families have about balancing their payments.

Families who need more information to understand the balancing process should be directed to Services Australia.

Resource You can…
Frequently asked questions read these to find out more information.
Information sheet – CCS Balancing distribute this article to families who attend your service.
Self-print poster – Family Update display this poster at your service.
Video – Balancing CCS share this video with families who attend your service.