What is Adjusted Taxable Income (ATI) for CCS?

ATI is a broader measure of income used by Services Australia to calculate CCS, FTB and other family payments. It starts with your taxable income and adds back items such as net rental property losses, reportable employer super contributions, reportable fringe benefits, total net investment losses, and tax-free government pensions or benefits.

Why is my ATI higher than my taxable income?

ATI adds back items that reduce taxable income but that the government considers part of your economic income. Common additions include: net rental losses (negative gearing), reportable fringe benefits from salary packaging, reportable employer super contributions above the super guarantee, and total net investment losses.

Does superannuation salary sacrifice affect ATI for CCS?

Yes, if the extra super contributions are reportable. Salary sacrifice to super above the standard Super Guarantee rate creates a Reportable Employer Super Contribution (RESC) that is added to ATI. This means salary sacrificing into super may not reduce your CCS-relevant income as much as it reduces your tax.

How do I estimate my ATI for a Centrelink income estimate?

Start with your expected taxable income (salary, investment income, etc.), then add: any reportable fringe benefits, any reportable employer super contributions, any net rental or investment losses (they cannot reduce ATI), and PPL or other taxable government payments. The CCS Checker uses your estimate of combined ATI to estimate your subsidy percentage.

What is Adjusted Taxable Income (ATI)?

4 min read Updated 11 February 2026

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When you apply for Child Care Subsidy (CCS), Services Australia doesn't just look at your taxable income. Instead, they calculate your Adjusted Taxable Income (ATI) - a broader measure of your financial capacity that includes several additional income types.

Your ATI determines the percentage of child care costs the government will cover. The higher your family's combined ATI, the lower your subsidy rate.

How ATI is Calculated

Your Adjusted Taxable Income is calculated using this formula:

ATI = Taxable Income + Additional Income Components - Deductions

Components That Increase Your ATI

The following amounts are added to your taxable income:

1. Taxable Income

Your total assessable income minus allowable deductions as shown on your tax return or Notice of Assessment. This includes:

Salary and wages
Business income
Investment income (dividends, interest)
Taxable superannuation withdrawals
Rental income (net of expenses)

2. Reportable Fringe Benefits

The "grossed-up" value of non-cash benefits from your employer, such as:

Company car for private use
Private health insurance paid by employer
Meal entertainment allowances
Low-interest loans from employer

This amount appears on your payment summary or income statement. Only fringe benefits totalling more than $2,000 in the FBT year (1 April to 31 March) are included.

3. Reportable Superannuation Contributions

These are super contributions above the compulsory amount, including:

Salary sacrifice super contributions
Personal super contributions you claimed as a tax deduction

This does not include the 12% compulsory employer super guarantee (for 2025-26). The reportable amount appears on your payment summary.

4. Tax-Free Government Pensions and Benefits

Certain tax-free payments still count towards your ATI, including:

Disability Support Pension
Carer Payment
Some Department of Veterans' Affairs (DVA) payments
Tax-free component of some other Centrelink payments

5. Foreign Income

Income from overseas sources that isn't already included in your Australian taxable income, such as:

Foreign employment income
Overseas pension payments
Foreign investment income

6. Net Investment Losses

If your investment deductions exceed your investment income, the loss amount is added back to your ATI. This includes losses from:

Share investments
Managed funds
Other financial investments

7. Net Rental Property Losses (Negative Gearing)

If your rental property expenses exceed your rental income, the loss amount is added to your ATI. This is commonly known as "negative gearing."

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Deductions That Reduce Your ATI

Child Support Paid

If you pay child support to another person (not receive), this amount is subtracted from your ATI. This is the only deduction that reduces your ATI for CCS purposes.

Example ATI Calculation

Here's an example for a single parent:

Component	Amount
Taxable income	$75,000
Reportable fringe benefits	$3,500
Reportable super contributions	$5,000
Tax-free pension	$0
Foreign income	$0
Net investment losses	$0
Net rental property losses	$8,000
Subtotal	$91,500
Less: Child support paid	-$6,000
Total ATI	$85,500

In this example, even though the taxable income was $75,000, the ATI used for CCS purposes is $85,500.

Why ATI Matters for CCS

The Child Care Subsidy uses income thresholds based on ATI, not just taxable income. For the 2025-26 financial year:

Families with ATI up to $85,279 receive the maximum subsidy rate (up to 90%)
The subsidy rate gradually reduces as ATI increases
Families with ATI above $535,279 receive no subsidy (0%)

Understanding your full ATI helps you:

Accurately estimate your CCS entitlement
Avoid unexpected debts at end of financial year balancing
Plan strategies to optimise your subsidy rate

Tips for Managing Your ATI

Update your income estimate promptly when circumstances change
Include all components when estimating your income to Centrelink
Check your estimate at the start of each financial year
Consider the timing of salary sacrifice decisions and their impact on ATI — if you're considering an EV novated lease, see our guide on how EVs and FBT interact with CCS

Official sources

For the most current information, visit:

This is general guidance only. Report all changes (income, relationship, care arrangements) promptly via myGov. For personalised advice, contact Services Australia at 136 150 or visit servicesaustralia.gov.au/child-care-subsidy.

2025-26 income test thresholds (subject to indexation): Subsidy starts tapering from $85,279 (90% rate), down to 0% at approximately $535,279. Child support paid is the main deduction. For complete details including foreign income treatment, see servicesaustralia.gov.au/child-care-subsidy/income-test.