Fees and allowances

To help you focus on providing the support and care the children and young people in our region need, our partners pay a generous foster allowance . All foster carers receive a weekly fostering allowance to cover the cost of caring for a fostered child. Each Local Authority sets their own fostering allowance rates based on Government guidelines. 

In addition to the fostering allowance, all authorities within our partnership appreciate that many people give up or reduce working hours to become foster carers and offer competitive financial packages and support to reflect this. Fees payments are also made to financially support you when becoming a foster carer, these are also made on a weekly basis. Some partners also pay additional allowances for special occasions, retainer fees, council tax reimbursements, or other benefits such as memberships to fostering support organisations.

In summary, the fostering allowance covers the cost of caring for the child, whilst the fee provides an income to you as a foster carer.
 

What does the fostering allowance cover?

Foster carers receive a fostering allowance for each child, and adult in the case of parent and child placements, who stays with them. Allowances are paid on a weekly basis and cover the cost of caring for the child as well as providing an income. 

Fostering allowance is paid per child based on their age. It covers:

• the cost of feeding the children in your care.
• utility costs associated with caring for children and young people in your home.
• expenses for clothing.
• transport costs.
• entertainment, activity and recreational costs.
• any pocket money for the child or young person.

 

Self-employment and paying tax and National Insurance

All foster carers in the UK are classed as self-employed and are not employed by their Local Authority fostering service. If you become a foster carer you will need to register with HMRC for the role.

To make fostering an affordable choice, the Government applies a generous tax-free allowance to fostering income.  You can find further information and an illustration of how this works, on Help and Support for Foster Parents in England

 

Can foster carers claim benefits?

As a foster carer you may be entitled to claim benefits and tax credits. The allowances you receive from fostering are normally disregarded as income or only taxable profit from your fostering is taken into consideration for the purposes of calculating your entitlement to benefits.

People who claim benefits already also may not automatically lose those benefits if they start to foster. The exception to this is job seekers allowance as a foster carer who is looking after a child in placement will not usually be available for work.

The Department for Education funds Fosterline, which offers confidential and impartial advice, information and signposting on a broad range of issues of concern to current and prospective foster carers, including specialist tax and benefits advice and support to the foster carer and members of the fostering household. They can be contacted on Freephone number 0800 040 7675, from 9am to 5pm, Monday to Friday or by visiting their website. 

For further information about claiming benefits while fostering you can visit the Government's website.

Want to find out more? We want to reassure you that we're here to help you make fostering work for you. Our foster carer advisers can explain how fostering fees and allowances work, so you can make informed choices.