What to do with this activity?

"Subtraction" is a big word that at this age might sound complicated. Show your child that it's simply about "taking away" things, and that things are represented by numbers. Use items you have in your home, like apples, or smarties, or pieces of lego. Get your child to count and lay out a certain number of items, then ask them to "take away" some. Encourage them to count out loud, and show them how to write the numbers down as a sum. 

For instance, get them to lay out 12 items and write the number 12 down on a page. Ask them to "take away" or "subtract" 5 of those items, and to count how many are left. Then show them how to write that down as a sum "12 - 5 = 7". The minus sign just means "take away" or "subtract".  Show your child that subtraction is the opposite of addition. Using the same items as before, show them that if they add 5 items to 7 items it makes 12 (5 + 7 = 12).

Keep it simple until they understand how subtraction works, then encourage them to do it all on paper. If they need, they can draw a small upright line to represent each "thing" and cross out the required number of lines to see what's left.