Private Day Care Allowance

The purpose of the Private Day Care Allowance is to help with the arrangement of day care for children under school age. It can be paid to a private child care provider designated by the parents. It is payable for each eligible child in the family from the end of the parental allowance period or the extended paternity leave until the child starts school.

For children within the extended compulsory education system, it is paid until the end of July in the year in which the child reaches the age of 7 years.

If there is a child under age three in the family, the parents can choose between child home care allowance and private day care allowance. Parents of a child under three years for whom they are paid Child Home Care Allowance may be able to get private day care allowance for their other children.

The day care services can be provided by an individual or organization offering fee-based child care services, or by a non-family member who has signed a contract with the parents for at least one month. The allowance is not paid if a relative or some other individual looks after the child without a formal employment contract or charges no fee for his/her services. However, if the child is under three years old, the parents can apply for child home care allowance.

Amount of the allowance

The private day care allowance consists of a basic allowance and an earnings-related supplement, which are paid for each eligible child.

Care allowance €160 / child / month and income-related care supplement up to €134.55 / child / month.

The supplement is paid at its full rate if the family’s monthly income is below a limit that varies with family size. Excess income reduces the supplement by a certain percentage. Family size and income are determined according to the same criteria that apply to the child home care allowance.

A family is considered to be parents and up to two children under school age. If family income exceeds the income limit, the full amount of the care supplement is reduced by a percentage of the excess income.

If the child attends a part-time pre-school arranged by the municipality one year before starting school, or if the child starts school one year early (at age 6), or if the child is within the extended compulsory education system and in his/her first year of school, the care allowance is paid at a rate of €58.87 per month, and the amount of the care supplement is halved.

Some municipalities grant a special municipal supplement. The municipalities decide for themselves whether to grant the supplement and either pay it themselves or have Kela pay it along with the regular allowance.

While parenthood allowance counts as income for purposes of calculating the supplement, it is not directly deducted from the supplement.

Payment of the allowance

The private day care allowance is paid directly to the provider of the service, i.e. a private childminder or a day care centre. For tax purposes it counts as income of the care provider. If the provider charges less than the allowance, the excess is not paid. The allowance is not paid for less than one month. In most cases, the care provider’s fee or wage is higher than the allowance, so the parents must pay the rest. Kela assumes no liability for obligations incurred by the parents in their capacity as employers.