The government provides several different financial payments and incentives to help young families with the costly process of raising children in Australia. Our other blog explores some of the support families can access through the Family Tax Benefit system. Here we cover some of the more specific means of financial support that are available to families who need it.
Child Care Benefit: If your child attends an approved daycare/preschool facility, and you meet the required income and residency levels, you may be entitled to receive a supplement in this area. The maximum rate is based on a family earning less than $46000 per annum but you will still qualify for some payment with a six-figure income, depending on the number of children you have. Most opt to have the child care benefit paid directly to the child care provider, reducing weekly upfront costs. Qualification to receive this benefit ends once your child reaches school age. See the end of the article for expected changes to this benefit in 2018.
Child Care Rebate: If your income is too high for the child care benefit you may still be entitled to receive the child care rebate, which is not income tested. The rebate can cover up to 50% of your child care expenses, up to a maximum of $7613 per child for the 2018 financial year. The rebate and benefit are not mutually exclusive, meaning you can receive both. As per the end of this article, there are changes to be expected concerning this rebate.
School Kids Bonus: Up until this year the school kids bonus has been available at the end of the financial year to children in both primary or secondary school. This payment has now been discontinued with no intention to replace it. Instead check out this MoneySmart article which makes suggestions for how to manage school costs.
Saver Plus: Run by the Brotherhood of St Laurence, this program assists individuals and families on lower incomes with a matched savings and financial education program. It offers up to $500 in matched savings for education costs, including uniforms, books, tuition, sports equipment and laptops. The program also includes assistance and support to develop a savings goal and plan. Check the program out here.
Newborn Upfront Payment and Newborn Supplement. If you have recently had a child and are eligible for Family Tax Benefit A, you may also qualify for one, or both, of these payments. The upfront payment is currently $532 with the supplement being paid for up to 13 weeks from the time you start caring for the child. Foster parents or those adopting a young child or baby may also qualify.
Parental Leave Pay. If you have recently had a child you may be entitled to receive Parental Leave Pay. To qualify you must have an individual income below $150,000 per annum, and have satisfied the work test for the period of 13 months prior to the arrival of the child. This payment may be in lieu of receiving the Newborn payment entitlements.
From July 2018 both the child care benefit and child care rebate will be replaced with a new Child Care Subsidy, a single means-tested child care payment. This is part of a larger government revamp under the title of Jobs for Families Child Care Package.
Under the new arrangement a family earning up to $65710 per annum is eligible to receive up to 85% of their child care charges covered under the scheme, gradually reducing to 20% for a family earning up to $340,000 per annum. The new scheme includes an activity test which determines the hours of work, study or training being undertaken by the parent for which the child care assistance is required.
The Jobs for Families Package also includes the Child Care Safety Net which ensures those children most vulnerable are provided with additional support as required. The Safety Net is gradually being phased in from 2016. A full overview of the new Jobs for Family Package can be found here.
In addition to federal legislation there may be financial assistance for school children in your respective state, such as school transportation. Please check out your state government website for more details.
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The information in this article is general in nature and does not take into consideration your personal situation or circumstances. You should consider whether the information contained in this article is suitable to your needs and where appropriate, seek professional advice from a financial adviser or other finance professional.