Whether this is your first or fourth child, a common issue for all families is how they are going to manage financially. Most families will have a significant cut in income for at least the first few months after the baby arrives, and depending on how the parents juggle work, the family could be on a single income for years.
If you live in NZ check out our article on the government benefits available to you.
Luckily, there are a range of government benefits available to Australian families, which are managed by the government's Family Assistance Office. Here's quick run-down of what's available: Paid Parental LeavePaid Parental Leave is now available for Australian families and is paid by the federal government. If you have earned less than $150,000 in the previous financial year before your child is born or adopted and you have been employed for at least 330 hours over 10 months of the previous 13 months, you may be eligible to get Paid Parental Leave.
Parental Leave Pay is paid at the rate of the National Minimum Wage for a maximum period of 18 weeks, which is currently $570 per week before tax (totaling $10,260 before tax). Parental Leave Pay is taxable. The rate of tax depends on your individual circumstances.
When a mother goes back to work, if she hasn't used the full 18 weeks of leave, the parental leave scheme is also available to the father or primary carer of the child if he is able to meet the eligibility criteria.
If you get Paid Parental Leave you are not able to also get the Baby Bonus, unless you have twins or more. If you have a multiple birth you may be eligible for Paid Parental Leave and the Baby Bonus.
If you have not worked and are not eligible for Paid Parental Leave then you can still claim the Baby Bonus. See our article on Paid Parental Leave for more information.
The Baby BonusThe Baby Bonus is a $5,294 payment to anyone who delivers a child, or who takes over as the primary carer of a newborn child within 26 weeks of the child's birth. It is paid as 13 fortnightly installments of $407. For adopted children, the child must have come into your care before the child is two years of age.
To be eligible your adjusted taxable family income in the six months after your child is born or adopted must be less than $75,000. You can not get the Baby Bonus and the Paid Parental Leave for the same child. If you have twins or more you may be eligible for both.
Family Tax BenefitsFamily Tax Benefit Part A is paid if you have at least one dependent child (can be up to age 24 if a full time student) and your family income is less than around $100,000 (this cut-off increases with the number of dependent children). The amount you will receive depends on the combination of income and number of children, and is worked out by the Government when you lodge your tax return.
Family Tax Benefit Part B gives extra assistance to families with one main income and dependent children under 18 years of age. You are eligible for payments if that one main income is less than $150,000. For two parent families, where both parents work, the second income must be less than around $4,500 to still be eligible.
Child Care BenefitsThe Child Care Benefit is available if your child or a child in your care is fully immunised, attends a registered child care centre and your family income is less than around $120,000. You can choose to have your benefit paid either as a reduction of the child care fees during the year, or as a lump sum when you lodge your tax return.
There is also the Child Care Rebate which covers 50 per cent of out-of-pocket child care expenses for approved child care, with a rebate of up to $7,500 (indexed) per child per year. Generally you must have worked or have studied/trained while your child was in care to receive this benefit. You can have your Child Care Rebate payments paid directly to an approved centre, to you as regular payments or as a lump sum.
Other paymentsYou may also be eligible for other types of payments such as:
Large Family Supplement for three or more children;
Multiple Birth Allowance if three or more of your children were born at the same time;
Rent Assistance which can give you extra help if you receive more than the base rate of Family Tax Benefit Part A and you pay rent to a private landlord;
Health Care Cards, which are issued automatically if you receive the maximum rate of Family Tax Benefit Part A and you get your payment through the Family Assistance Office.
Jobs, Education and Training Child Care fee assistance which helps with the cost of approved child care for parents undertaking activities such as work, job search, training, study or rehabilitation as part of an activity agreement, to help them enter or re-enter the workforce.
There are several eligibility tests you must meet to qualify for different payments. Your family and individual income, the percentage of time the child is in your care, your Australian residency will also be considered when determining whether you are eligible for benefits. Most payments are made on a sliding scale depending on how many children you have and your income. Plus, the specific payment amounts and income levels change regularly.
A good place to start is the Department of Human Services, or visit your local Medicare or Centrelink office which usually includes a Family Assistance Office.
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Last reviewed: June 2012