How much is Centrelink Parental Leave Pay?

What is Parental Leave Pay, who is eligible, how much is the payment, and how do I apply? Read on for more information.

Introduction

When preparing for the arrival of your newborn, there are so many things to do it can get overwhelming. Having an understanding of the payments you are entitled to as a primary caregiver can help ease the process and ensure a smooth transition. Here is a quick guide on the paid parental leave scheme, how to apply and what you are entitled to. Although the length of paid parental leave is quite short in Australia when compared to other countries, this payment can be a huge bonus and support to families to cover the initial additional costs of a newborn or newly adopted child.

What is Parental Leave Pay?

Parental Leave Pay is a payment given by the Australian Government to assist in looking after a new child. The payment is available for up to 20 weeks. It is important to know that this is a taxable payment that is paid according to the current National Minimum pay rate.  As of 1 July 2023, the National Minimum Wage in Australia is $23.23 per hour or $882.80 per week.

paid parental leave, parental leave pay
There are a few requirements to be eligible for Parental Leave Pay – make sure you check your eligibility HERE2.

How much is the Centrelink parental leave pay?

As of 1 July 2023, the National Minimum Wage in Australia is $23.23 per hour or $882.80 per week. You can get up to 100 payable days. The current payment for Parental Leave Pay is $176.55 a day before tax or $882.75 for 5 days per week.

Do you pay tax on parental leave?

Paid parental leave is a taxable income. The way it is calculated is if you claim Parental Leave Pay through your workplace or employer, they will withhold tax at normal PAYG withholding rates as usual. If Centrelink is paying you, 15% PAYG tax is withheld.

Is paid parental leave a lump sum?

As clarified by Services Australia1; No, parental leave cannot be provided as one lump sum. If you usually get paid fortnightly by your employer, these payments will remain the same.

Who is eligible for Parental Leave Pay?

There are a few requirements to be eligible for Parental Leave Pay. Everyone’s circumstances are different so it is important to read the criteria2. Here is a short summary below:

●     You must be the primary carer of a newborn or a recently adopted child. This is the person that meets the child’s physical needs more than anyone else in that period. The rate of Parental Leave cannot be split between carers.

●     You must meet visa and residency requirements.

●     You should meet the Paid Parental work test which means you have worked for at least 10 of the 13 months before the child’s birth or adopting the child. You need to have worked for at least 330 hours in the 10-month period. This averages to approximately 7.6 hours per week.

●     It is important that you be on leave and should NOT be working from the time you become the child’s primary caregiver until the end of the Paid Parental Leave period.

What is Dad and partner pay?

Dad and partner pay is a payment that can be made, for up to 2 weeks, for a child born or adopted before 1st July 2023. It is paid as one installment, directly into your bank account. It is the same rate as the Parental Leave Pay – $882.75 per week before tax. If the child is born or adopted after 1st July 2023, then the Parental Leave Pay is most likely applicable to you. You can read more about Dad and Partner Pay HERE3.

dad and partner pay
Dad and partner pay is a payment that can be made, for up to 2 weeks, for a child born or adopted before 1st July 2023.

How long is Parental Leave paid for?

According to Fair Work Ombudsman4, From the 1st of July 2023, employees who meet the requirements and who are the carer of either a newborn or newly adopted child can get up to 20 weeks of Parental Leave Pay.

centrelink parental leave pay
From July 2023, there have been a two-week boost and parents now receive 20 weeks of paid parental leave.

What is the difference between parenting payment and paid parental leave?

It can be confusing as the terms are similar. Here is a quick breakdown of both payments.

●     Parenting Payment: This is an income support payment that aims to provide assistance for the primary carers of a young child. It is aimed at low-income parents and helps them cover the day-to-day costs of looking after a child. It is both income and assets tested. You can read more about Single Parenting Payment HERE.

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●     Paid Parental Leave: This is a short-term payment (for 20 weeks) to help families who take time off work, to care for their newborn or newly adopted child. This payment is income tested.

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For more information on different types of parenting payments, visit: https://raisingchildren.net.au/grown-ups/family-life/managing-money/government-payments5

What changes were made to Parental Leave Pay in 2023?

According to an article in SBS News6, previously parents were entitled to 18 weeks’ leave. From July 2023, there have been a two-week boost and parents now receive 20 weeks of paid parental leave. Although Australia is still very behind in comparison to other countries around the world, The Labor Government is looking to progressively increase the number of weeks to 26 weeks by 2026. 

How do you apply for Parental Leave Pay?

Services Australia7 outlines clear steps on how to make a claim. Here is a summary of what to do:

1.    Talk to your employer

      Give your employer approximately 10 weeks’ notice before your child’s due date   

      or prior to the adoption date. The employer will then need to register with

      Services Australia.

     2. Think about what you are claiming

     If another parent also plans to take leave discuss how much each of you will take.

     3. Claim online

    Use your Centrelink online account or create one if you haven’t already. You will

    need to make sure your Centrelink account is linked with MyGov.

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     4. Make sure all your supporting documents are ready

     5. Start and Submit your claim on MyGov   

     6. Track your claim

parental leave pay
Employers need to be given prior notice, so it is important you plan and make your claims beforehand to ensure it is a smooth process.

FAQs about Parental Leave pay:

-Is parental leave pay paid fortnightly?

Ultimately, it depends on your employer but in most cases, it is paid fortnightly.

– Is parental leave paid by the employer or Centrelink?

It is a payment by the Government made directly to the employer who then pays the employee.

– Is super paid on paid parental leave?

No, you do not receive super on your paid parental leave.

Conclusion

Employers need to be given prior notice, so it is important you plan and make your claims beforehand to ensure it is a smooth process. Familiarize yourself with what you are entitled to, the requirements and what supporting documents you need to make a claim. Further information is available on the Services Australia8 website.

You might also be interested in my articles on:

Subsidy For Childcare; Everything You Need To Know

ACCS – What Exactly Is Additional Child Care Subsidy?

Foster Care Payments; How Much Do You Get?

Money Saving Tips For 2023 – 15 Easy Ways!

Reference List:

  1. Providing Parental Leave Pay, Services Australia. Accessed online at https://www.servicesaustralia.gov.au/providing-parental-leave-pay?context=23121#:~:text=You%20must%20provide%20Parental%20Leave,take%20it%20at%20half%20pay on July 24, 2023.
  2. Who can get it (PLP), Services Australia. Accessed online at https://www.servicesaustralia.gov.au/who-can-get-parental-leave-pay-for-child-born-or-adopted-from-1-july-2023?context=64479 on July 24, 2023.
  3. Dad and Partner Pay, Services Australia. Accessed online at https://www.servicesaustralia.gov.au/dad-and-partner-pay on July 24, 2023.
  4. Paid parental leave, Fair Work Ombudsman. Accessed online at https://www.fairwork.gov.au/leave/maternity-and-parental-leave/paid-parental-leave#:~:text=Related%20information-,Australian%20Government%20Paid%20Parental%20Leave%20scheme,at%20the%20National%20Minimum%20Wage on July 24, 2023.
  5. Government parenting payments, RaisingChildren.net.au. Accessed online at https://raisingchildren.net.au/grown-ups/family-life/managing-money/government-payments on July 24, 2023.
  6. Paid parental leave has been expanded. So what’s changed?, Finn McHugh, SBSNews. Published: March 7, 2023. Accessed online at https://www.sbs.com.au/news/article/paid-parental-leave-has-been-expanded-but-whats-changed/spmd9574x on July 24, 2023.
  7. How to claim (PLP), Services Australia. Accessed online at https://www.servicesaustralia.gov.au/how-to-claim-parental-leave-pay-for-child-born-or-adopted-from-1-july-2023?context=64479 on July 24, 2023.
  8. Parental Leave Pay, Services Australia. Accessed online at https://www.servicesaustralia.gov.au/parental-leave-pay on July 24, 2023.

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