The changes: What you need to know

• From July 2018 the Child Care Subsidy replaces the Child Care Rebate and the Child Care Benefit, this includes JET child care fee assistance, support for grandparent carers and child care benefit for registered care.
• The subsidy is means tested and families will pay the gap between the level of subsidy they receive and the fee charged by the service. The subsidy will cover:
  
  
  • 85 per cent of fees for families earning under $65,710,
  • 50 per cent of fees for families on $170,710-$250,000 and
  • 20 per cent for those earning up to $350,000
  • 0 for those earning more than $350,000
• For families earning $185,000 or more an annual cap of $10,000 per child per year will apply, for families earning less than this there is no cap.
• The subsidy will be paid directly to the child care service.
• An activity test applies and both parents must be working, studying or volunteering for at least 8 hours per fortnight to receive the new subsidy.
• The new Child Care Safety Net means families which earn less than $65,170 will be eligible for 12 hours of subsidised care per week. Families which earn more than that and don't meet the activity test will be ineligible for the subsidy.