Childcare costs feel confusing until someone walks you through how they add up. Once you understand how the child care subsidy is calculated, the calculator becomes a useful planning tool.
Here’s how CCS works in 2026-27 and how to use a calculator to get a real picture of what you’ll pay.
How Is Child Care Subsidy Calculated? The Four Key Factors
Before you open a calculator, it helps to understand what goes into your CCS amount. There are four main things that determine what your family receives.
1. Your family’s adjusted taxable income (ATI)
This is the biggest factor by far. Your CCS percentage is determined by your combined family ATI and slides on a scale from 90% at the lower end down to 0% as income rises.
For 2026-27, families with a combined ATI of up to $88,520 receive the maximum CCS rate of 90%. Above that threshold, the rate drops by 1 percentage point for every additional $5,000 of income, reaching 0% at $538,520.
One thing that catches a lot of families off guard: ATI is not the same as your salary or your taxable income. It includes rental income, investment income, reportable fringe benefits from salary packaging, and capital gains. A family earning $150,000 in wages but with $20,000 in net rental income has an ATI of around $170,000, which puts them in a meaningfully lower subsidy band than their pay packet alone would suggest.
Always use your ATI when calculating your child care subsidy estimate, not your gross income.
2. The hourly rate cap
The government sets a maximum hourly fee it will apply your subsidy percentage against.
For centre-based day care (children under school age), the 2026-27 hourly rate cap is $15.19 per hour. If your centre charges more than this, CCS is still only calculated up to $15.19; you pay any above-cap difference yourself, on top of your regular gap fee.
3. Your subsidised hours
From 5 January 2026, all CCS-eligible families receive at least 72 subsidised hours of care per fortnight, the 3 Day Guarantee. Families where at least one parent does more than 48 hours of recognised activity per fortnight can access up to 100 hours.
4. The number and ages of your children
Families with more than one child aged 5 or under in care may receive a higher subsidy rate for the second child and younger children, up to 95% CCS.
This applies even if the children attend different services, and it can make a significant difference to your weekly costs if you have two kids in care at the same time.
Using the Calculator: What to Enter
How much childcare subsidy will you get? Here’s what you’ll need to get a useful estimate from the childcare subsidy calculator:
| What to Enter | Where to Find It |
|---|---|
| Combined family ATI | Last year’s tax return or myGov income estimate |
| Centre’s daily fee | Your centre’s fee schedule |
| Session length in hours | Usually 10–12 hours for long day care |
| Care days per week | Your current or planned enrolment |
| Number of children in care | Including ages |
Once you’ve entered your details, the calculator will show your estimated CCS percentage, the subsidy amount applied per session, and your likely weekly out-of-pocket gap fee. It’s worth running these numbers before you commit to an enrolment, or before you compare centres. A seemingly small difference in daily fees can translate into a much larger annual gap, especially if one centre charges above the hourly rate cap.
A Common Mistake: Using Gross Income Instead of ATI
This is worth repeating because it’s one of the most common errors families make when estimating their CCS.
Your CCS is assessed against your Adjusted Taxable Income, which the government calculates differently from your taxable income or your employer’s reported earnings. Things like salary packaging arrangements, novated leases, net rental losses, and investment income can all push your ATI higher than your take-home pay would suggest.
If you’re in any doubt, check your most recent Notice of Assessment from the ATO, which will include your ATI figure. Entering an accurate number into the calculator makes the estimate far more reliable and can prevent an unexpected debt at end-of-year reconciliation.
What About Families With Two or More Children in Care?
If you have a second child aged 5 or under in care, the higher CCS rate applies to them automatically; you don’t need to apply separately. The standard rate child is usually the eldest CCS-eligible child aged 5 or under. The higher rate (up to 95%) applies to younger siblings.
This higher rate has its own income threshold, currently set at $368,000 for 2026-27. Families above this threshold may not receive the higher rate for younger children. The childcare subsidy calculator will factor this in if you enter the correct number and ages of children.
QLD Families: Your Calculator Result Is Only Half the Picture
If your child is turning 4 this year and you’re based in Queensland, your CCS is just the starting point. QLD kindergarten funding through the Free Kindy program covers up to 600 hours of the approved kindy program per year, applied on top of your CCS, not instead of it.
The way it works is: CCS is calculated first against your session fee. Free Kindy then covers the part of your remaining gap that relates to the approved kindy program. At Rise & Shine, the funding is applied directly to your fees, so there’s no claiming or paperwork at your end.
Running a calculator estimate without factoring in Free Kindy will overestimate what QLD families pay during the kindy year.
NSW Families: Start Strong Funding Can Lower Your Childcare Fees
If you’re in New South Wales, your Child Care Subsidy (CCS) estimate may not reflect your final childcare fees. Eligible families can also receive Start Strong funding, which is applied alongside CCS to further reduce the cost of approved preschool and kindergarten programs.
At Rise & Shine Kindergarten, eligible Start Strong funding is applied directly to your fees. Because funding varies based on your child’s enrolment and circumstances, a childcare subsidy calculator may overestimate what you’ll actually pay.
For the most accurate estimate, contact our team for a personalised quote that includes your CCS, Start Strong funding, and any other available savings.
Still Not Sure What You’d Pay?
Our team can walk you through your specific situation, including how Free Kindy and CCS work together for your family and what the weekly cost would look like at our centres.
Get in touch with Rise & Shine to get started.
