Parents who home-school children will not have to put them on a compulsory register, despite calls for one to be created after a child died in 2011.
Councils will instead have to create a database to identify children not on a school register under plans to revamp home education.
Education Secretary Kirsty Williams is due to give a statement on Tuesday.
She will also announce plans for a "comprehensive package of support" for home educators, including exams help.
The plans are for statutory guidance - compared with the non-statutory guidance published a year ago, which Sally Holland, the Children's Commissioner for Wales, described at the time as "disappointing".
She called Tuesday's announcement a "step in the right direction".
Councils do not need to be told if a child is home educated, unless they are removed from school.
The new plans will not change that but will require councils to create a "reasonably complete" database so they can identify children who are not on a school register.
Ms Williams will consult on how the database will be managed and look at which partners - such as health boards - will be able to contribute to it and whether independent schools should be required to tell councils about pupils in their schools.
Ms Holland and NSPCC Cymru both called for a compulsory register of home educated children after Dylan Seabridge - a home-educated eight-year-old - died of scurvy in Pembrokeshire in 2011.
A report by the National Independent Safeguarding Board recommended the same thing.
Instead, these new plans will outline the arrangements local authorities will be expected to put in place to identify home-educated children and assess the suitability of education.
Support for home educators will include help with exam registrations, the same health offers made to children in school, making the Hwb online learning portal available and support from Careers Wales.
Ms Williams said: "There are many valid, different and sometimes complex reasons why parents would choose to go down this route and in some cases this will be the best choice for the child.
"But this choice must be balanced with the right of children to receive a suitable education.
"Local authorities, by establishing a database supported by statutory guidance, will be able to assess whether a child is receiving a suitable education and, if they are educated at home, that home educators have the support they need."
Ms Holland said she was pleased to see a "step in the right direction", adding: "In reality it means there'll be a statutory requirement for local authorities to know who is being home educated and what those children are being taught."
The NSPCC said a compulsory register would help to ensure children did not become "invisible to authorities, adding: "Greater support for home educators and steps to improve data are welcome but we would like to see the Welsh Government go further."