Something to check if you’re receiving a childcare subsidy!
If you’re currently receiving a childcare subsidy, it’s important to check and update your income with Centrelink each financial year.
When you first applied for the subsidy, you would have provided an estimate of your income to Centrelink. This estimate helps them determine how much your childcare costs will be subsidised.
If your income has increased (or reduced) this new financial year, Centrelink will need to know so they can adjust your subsidy.
If your income increases, and you don’t remember to update Centrelink, you could end up owing the Government department money come the end of the financial year. The best way to avoid this is to check and update your income estimate!
Centrelink also withhold five per cent of your subsidy, to reduce the likelihood of an overpayment. If your income estimation was accurate for 2018/19, you may be entitled to receive this extra five per cent. This will be paid directly to you, along with any extra payments Centrelink calculates that they owe you after checking your final taxable income.
However, if you underestimated your income, you may end up owing some money to Centrelink. If the five per cent that was withheld is not enough to cover it, you might find you need to repay some money after submitting your tax return.