Many families across the country have had their Child Care Subsidy payments balanced for the first time. For some families, they will have received an overpayment. Department of Human Services General Manager Hank Jongen provides details to help families understand what getting a Child Care Subsidy overpayment means.
We are in the process of balancing Child Care Subsidy (CCS) payments for the first time. If you have received other family assistance payments from us (such as Family Tax Benefit or Child Care Benefit), this will be a familiar process, but for some CCS recipients this is brand new. Also, if CCS is the only payment you receive from us, this will be the first time you have estimated your income. Your income estimate plays an important role in getting your payments right. Your rate of CCS paid through the year is calculated using your estimate. Even a small change in your income can make a difference to the amount of CCS you get. We check your family income estimate against your family’s actual income at the end of the financial year. If your family’s actual income is more than your estimate, you may have to pay money back
Right now, some families might have a letter from us asking to repay money. We want to help to ease some of this worry by letting you know what will happen and what you can do if you get a debt.
How it works
We won’t be able to balance your payments until you have lodged your tax return with the Australian Taxation Office (ATO) or told us you don’t need to.
The CCS we pay you during the year is based on the income estimate you provided us, so once we know what you have actually earned for the year we can make sure we have paid you the right amount. This could mean we haven’t paid you enough and you will receive a top-up to your payment. However, this could also mean that you have been paid too much and you will need to pay this money back.
There are different pieces of information we need to confirm incomes, such as information from the ATO and final attendance reports from child care providers. Because every family is different, the timeframe for balancing payments will vary. Activity levels also affect eligibility for Child Care Subsidy. We use activity levels to work out the number of hours of subsidised child care a family can get each fortnight. Families need to make sure they provide accurate activity levels as this can also result in a debt being raised when we balance payments. It is important that you tell us within 28 days of your activity level changing as we cannot always backdate these changes and you may not be able to receive an increased subsidy for your activity.
Managing an overpayment
Once we have balanced your payments you will receive a letter, which for the vast majority of families will appear in your myGov inbox. The letter will detail what subsidy you received, what you were entitled to and the difference, if any, between these. If you have been overpaid CCS during the year, you will have a debt advised on this letter.
As part of trying to help families avoid a debt, we automatically withhold five per cent of your CCS payment throughout the year or you may have also elected to withhold a higher percentage. This withheld amount will be used at balancing time to offset any overpayments received. However, if your overpayment is greater than your withholdings, you will need to pay this money back. You have 28 days to do this, and while some families will be able to pay off their whole debt amount in this time, we understand that others may not. If this is the case for your family, the letter also has details about other repayment options available to you.
I do need to let you know that if you don’t repay the money in full, or contact us to discuss paying your debt prior to the 28 days deadline, we will set up an automatic deduction. We can recover your debt from your Family Tax Benefit or income support payment or future CCS payments. We want to work with you to help manage any overpayment. If you are no longer receiving CCS or any other payment from the department and there isn’t a suitable repayment arrangement in place within 28 days, we may refer your debt for external collection.
Families can manage and view their debts online by selecting Money You Owe in their Centrelink online account through myGov or the Express Plus Centrelink mobile app.
Where you are not receiving a regular payment from us for automatic deductions, there are a variety of other repayment options such as direct debit from your bank account, debit or credit card payments, BPAY and Australia Post’s POSTbillpay. If a payment plan is the best option for you to manage your debt, you can do so online via Money You Owe or by contacting our Debt Recovery Team on 1800
