What is the maximum Child Care Subsidy rate for FY 2025-26?

The maximum CCS rate is 90% for families with a combined income of $85,279 or less. For every $5,000 of income above this threshold, the subsidy rate decreases by 1 percentage point. The subsidy reaches zero at $535,279. A higher rate of up to 95% applies for second and subsequent children aged 5 or under, for families earning below $367,563.

What are the hourly rate caps for childcare?

For FY 2025-26, the hourly rate caps are: Centre-based day care $14.63/hr, Family day care $13.05/hr, and Outside school hours care (OSHC) $12.81/hr. If your provider charges more than the cap, the subsidy is calculated on the cap amount and you pay the difference out of pocket.

What is the 3-Day Guarantee?

From 5 January 2026, the 3-Day Guarantee ensures all families receive a minimum of 72 hours of subsidised childcare per fortnight (equivalent to 3 days per week), regardless of the activity test. This means even families who don't meet the activity test requirements will receive subsidised care for up to 3 days per week.

How is the higher CCS rate for multiple children calculated?

Families with more than one child aged 5 or under in approved care can receive a higher CCS rate for their second and subsequent children. The higher rate can be up to 95% for families with income under $367,563. This rate is calculated by adding up to 30 percentage points to the standard rate, capped at 95%.

What is the 5% CCS withholding?

Services Australia withholds 5% of your CCS entitlement throughout the year as a buffer against overpayments. At the end of the financial year, when your actual income is confirmed through your tax return, any overpaid or underpaid amounts are reconciled. If you were overpaid, the withheld amount helps offset the debt. Any excess withholding is paid back to you.

Childcare Subsidy Calculator Australia — FY 2025-26

Estimate your Child Care Subsidy rate, daily out-of-pocket costs, multi-child higher rates, and income strategies to maximise your entitlement.

The Child Care Subsidy covers up to 90% of fees for families earning under $85,279. From 5 Jan 2026, the 3-Day Guarantee ensures a minimum 72 hours/fortnight regardless of activity test.

Combined family income

Combined adjusted taxable income for CCS means test

Number of children in care

Children attending approved childcare

Child's age

Age affects higher rate eligibility for 2nd+ children

Care type

Different care types have different hourly rate caps

Daily fee

Your provider's daily fee for a full day

Days per week

Number of days your child attends per week

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How to Use This Calculator

Tab "Subsidy Estimate"

Enter your combined family income, number of children in care, child's age, and select the care type (centre-based, family day care, or OSHC). Under "More options," set your daily fee and days per week. The calculator shows your CCS percentage, hourly subsidy, daily and annual out-of-pocket costs, and annual subsidy received (after 5% withholding).

Tab "Multi-Child"

Compare subsidy rates for two children in care. Enter your family income and each child's age, daily fee, and days per week. The calculator applies the standard CCS rate to the first child and the higher rate (up to 95%) for the second child aged 5 or under, showing total family subsidy and out-of-pocket costs.

Tab "Income Strategy"

Explore whether reducing one parent's work hours could increase your CCS rate enough to offset the lost income. Enter your current combined family income and one parent's salary. See the CCS rate at current income vs. reduced hours, the net benefit of working an extra day, and the break-even income point.

The Formulas

CCS percentage (standard):
CCS% = 90% - floor((income - $85,279) / $5,000) x 1%
For income ≤ $85,279: CCS% = 90%
For income ≥ $535,279: CCS% = 0%

Higher rate (2nd+ child aged ≤5):
Higher CCS% = min(95%, standard rate + 30%)
Available for family income below $367,563

Hourly subsidy:
Hourly subsidy = CCS% x min(hourly_fee, hourly_rate_cap)

Daily subsidy:
Daily subsidy = hourly_subsidy x hours_of_care

Annual subsidy:
Annual = daily_subsidy x days_per_week x 50 weeks
Amount received = Annual x 95% (5% withheld)

Hourly rate caps (FY 2025-26):
Centre-based day care: $14.63/hr
Family day care: $13.05/hr
Outside school hours care: $12.81/hr

All rates are indexed annually. The CCS is based on combined family adjusted taxable income from the previous financial year, updated at end-of-year reconciliation.

Example

Sarah & Tom — Combined Income $120,000, 1 Child in Centre-Based Care

Child aged 3, attending 3 days per week at $150/day ($12.50/hr for 12 hours). Centre-based hourly cap: $14.63.

CCS percentage83.0%

Hourly subsidy$10.38/hr ($12.50 x 83%)

Daily subsidy$124.50

Daily out-of-pocket$25.50

Annual subsidy (after 5% withholding)$17,741

Annual out-of-pocket$3,825

At $120,000 combined income, Sarah and Tom are 7 steps above the $85,279 threshold (floor(($120,000 - $85,279) / $5,000) = 6), giving a CCS rate of 90% - 7% = 83%. Their hourly fee of $12.50 is under the $14.63 cap, so the full fee attracts subsidy.

FY 2025-26 CCS Rates

Item	Rate / Limit
Maximum CCS rate	90% (income ≤ $85,279)
Taper rate	1% per $5,000 above $85,279
Zero subsidy threshold	$535,279
Higher rate (2nd+ child ≤5)	Up to 95% (income < $367,563)
Centre-based hourly cap	$14.63/hr
Family day care hourly cap	$13.05/hr
OSHC hourly cap	$12.81/hr
Services Australia withholding	5%
3-Day Guarantee	72 hrs/fortnight from 5 Jan 2026

Frequently Asked Questions

How is the Child Care Subsidy calculated?▼

The CCS is calculated based on three factors: your combined family income (determines the percentage), the type of childcare (determines the hourly rate cap), and the activity test (determines the number of subsidised hours). The subsidy percentage starts at 90% for incomes up to $85,279 and reduces by 1% for every $5,000 of income above this threshold, reaching zero at $535,279.

What is the activity test for CCS?▼

The activity test determines how many hours of subsidised care your family can access per fortnight, based on the parent with the lowest activity level. Activities include paid work, study, volunteering, and looking for work. From 5 January 2026, the 3-Day Guarantee provides a minimum of 72 hours per fortnight regardless of activity level. Higher activity levels unlock up to 100 hours per fortnight.

What happens at end-of-year CCS reconciliation?▼

After you lodge your tax return, Services Australia reconciles your actual income against the estimate used during the year. If your actual income was higher than estimated, you may have been overpaid and will owe a debt. If lower, you may receive a top-up payment. The 5% withholding throughout the year helps buffer against overpayments. Reconciliation typically occurs July-October after the financial year ends.

Does the higher CCS rate apply to all my children?▼

No. The higher CCS rate (up to 95%) only applies to your second and subsequent children aged 5 or under who are in approved childcare. Your first child receives the standard rate. The higher rate adds up to 30 percentage points to the standard rate (capped at 95%), and is available for families with income under $367,563. The eldest child in care is always assessed at the standard rate.

Can I reduce my income to get a higher CCS rate?▼

Yes, reducing your combined family income can increase your CCS rate. Common strategies include one parent reducing work hours, salary sacrificing into super (which reduces adjusted taxable income), or timing income across financial years. However, you should consider the total financial impact — earning less to get a higher subsidy only makes sense if the increased subsidy outweighs the lost income. The Income Strategy tab helps model this trade-off.

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