Fostering is a fantastic and highly rewarding professional career. Our foster carers benefit from generous, and extremely competitive fostering allowances and payments. Jump across to our ‘foster carer rewards and benefits‘ page to learn more. Below you will find our fostering finance faq’s tool. We hope this tool will help answer any fostering money questions you may have, but if not just call our team on 0121 352 1844 for a friendly chat.
The age and the needs of the child are what determine how much you are paid for fostering. The amount you are paid to foster may change from placement to placement. The UK Government is responsible for setting the minimum fostering allowances each April, with amounts relative to a child’s age and needs. The current minimum fostering allowance is between £123 and £216 per week. At DMR Fostering Services however, we will always ensure our foster carers receive at least £376 per week per child. (£376 x 4 weeks = £1,504). Visit our ‘foster carer rewards and benefits‘ page for more information, or call our team on 0121 352 1844.
Foster carers are treated as self-employed for tax purposes. Many of our foster carers pay little or no tax at all on their income from fostering. Currently, there is a fixed tax exemption of up to £10,000 per year, which is shared equally among any foster carers in the same household. This means you will not pay any tax on the first £10,000 income (after expenses) you make from fostering.
In addition to this fixed tax exemption, you will also get tax relief for every week that a foster child is in your care. This means that you don’t pay tax on some of the income above this £10,000. The amount of tax relief you will receive depends on the age of the child. For a child under the age of 11, you will receive £200 of tax relief per week; and for a child over the age of 11, you will receive £250 in tax relief per week.
Here’s an example:
Charlie is a foster carer of an 13 year old for the whole of the year, and for an 9 year old for 10 weeks of the year. She doesn’t have to pay tax on the first £25,000 she earns. Here’s why: Tax exemption: £10,000 + Child 1 (52 x £250) = £13,000 + Child 2 (10 x £200) = £2,000. Total = £25,000 tax exception on fostering earnings.
Talk to our fostering team on 0121 352 1844 to learn more, or visit our ‘foster carer rewards and benefits‘.
Foster carers are paid an allowance based on the needs of the child, and the placement type. We do not continue to pay fostering allowances in between placements. That said, we always aim to have as little time in between placements as possible, should this be your wish.
Being paid to foster a child will not affect the amount of benefit you get.
Fostering is regarded as ‘Work’ for tax purposes by HMRC when they have a child in placement. This means some foster carers are eligible to claim Working Tax Credit.
Some foster carers will be eligible to claim income support.
Some foster carers are eligible to claim Employment and Support Allowance (ESA).
