Child Care Subsidy (CCS) overpayments arising from reconciliation 007-19022134

CCS reconciliation determines a customer’s correct CCS entitlement for the relevant income year (i.e. the year they received CCS payments). CCS reconciliation can commence from the 29th day after the end of the CCS year. Reconciliation will only occur for a customer once all the reconciliation requirements are met.

Customers cannot claim CCS as a lump sum.

CCS is paid directly to the child care provider on behalf of the customer in the form of reduced fees. The rate of CCS is based on an estimate of family income provided by the customer.

Each CCS customer (including partner, ex-partners and deceased partner relevant to the year being reconciled) must confirm their family income with Services Australia by 30 June of the year after the subsidy was paid. Income is confirmed by:

• the customer and any partner they had during the year lodging their Income Tax Return/s (ITR) with the Australian Taxation Office (ATO), or
• the customer advising the agency that they or any partner they had during the year are Not Required To Lodge (NRTL) an ITR and, advise of actual income or
• the customer and any partner they had lodging a Return Not Necessary (RNN) with the ATO and the customer advising the Agency of their actual income, or
• an ex-partner Most Recent Estimate (MRE) exception being coded for an ex or deceased partner

There is no bulk reconciliation process for CCS customers. All customers are required to meet the reconciliation requirements in order for reconciliation to occur.

At reconciliation, the customer's CCS entitlement for a relevant year is worked out by comparing:

• the amount of CCS a person received based on their estimate of their family's income, to
• the amount of CCS a person is actually entitled to, based on their family’s actual income and child care attendance for the relevant CCS year

Additional Child Care Subsidy (ACCS) qualification debts (that occurred throughout the 2018-19 financial year) will be included in the reconciliation result. However, ACCS periods are exempt from reconciliation i.e. income changes will not affect these periods

The result can be a top-up, overpayment or nil adjustment. If an overpayment is calculated, the amount is:

• raised as a debt in the Debt Application in Process Direct, and
• displays in the Debt Management and Information System (DMIS) on the OPDL screen

The customer is sent a reconciliation outcome/Account payable letter advising the debt amount. They can also view their reconciliation outcome via Online Services or the Express Plus app. To view and/or take action on a CCS debt raised in Process Direct see CCS debts.

Note: CCS reconciliation will take into account additional changes (qualification changes) made throughout the year that impact customer eligibility (such as retrospective changes to the Activity Test/recognised participation details). These changes will be included in the reconciliation outcome and could impact the final assessment.

If information used in a previous CCS reconciliation is corrected, updated or removed, the customer's CCS reconciliation will automatically be recalculated by comparing the previous result to the new information. This is called re-reconciliation. The result of a re-reconciliation can also be a:

• top-up,
• overpayment,
• or nil adjustment

There are some important differences between Family Tax Benefit (FTB) and CCS reconciliation debts.

• CCS and FTB debts will be raised separately, even if they occur at the same time
• CCS, CCB and CCR debts (if not paid in full) may be recovered from ongoing CCS fee reductions
• Only CCS and CCB/CCR debts can be recovered from CCS top-up payments