Little Acorns recognises the challenges of the fostering task and the vital role that foster carers play within the community.
We firmly believe in treating our foster carers as child care professionals and making sure they have all the right resources including an allowance to fulfil the task.
How much are the foster care payments?
Our carers receive a standard weekly fostering allowance of £440 per week per child in care. Depending on the needs of the child and their circumstances, additional allowances are available which can increase the allowance to £660 per week. Parent and Child fostering starts from £700 per week.
Fostering is classed as self-employment and there are generous tax allowances available to help. The important thing to remember is that each individual’s financial circumstances are different.
As a foster carer, you are given a fixed tax exemption of £18,140 per year, on top of your standard personal allowance of £12,570 which means you have a total fixed tax allowance of £30,710.
In addition, you also receive further tax-free exemptions of;
- £375 per week for child placements under the age of 11
- £450 per week for child placements aged 11 or over
Mr and Mrs Smith foster a sibling group of two for a year, one aged 8 the other aged 11. Mr Smith works full time and Mrs Smith is the main carer. Mr Smith utilises his personal allowance against his earnings.
The household receives a basic allowance of £18,140 as a fostering household, plus Mrs Smith benefits from a £12,570 personal tax allowance.
They also benefit from tax-free allowances for the 11-year-old of £23,400 and for the 8-year-old £19,500
Therefore, Mrs Smith receives a total tax-free allowance of £73,610
Mrs Smith receives a fostering allowance of £45,760 which is below the tax-free allowance, and therefore no tax is payable.
This is roughly equivalent to earning £64,000 per annum before tax.
What do the payments cover?
The payment to carers is provided to cover household costs, food, clothes, travel, school dinners and all the things you would reasonably expect when looking after a child.
Being a foster carer is no longer seen as a voluntary service. Foster carers need to be sufficiently funded to ensure the young person in care gets all the opportunities they would otherwise. Our fostering allowances enable foster carers to care for children and young people on a full-time basis.
National Insurance contributions
Carers are entitled to Home Responsibility Protection – a way to make sure that you do not get less Basic Retirement Pension because you decided to look after children at home.
In receipt of Benefits?
Any payments paid to foster carers for fostering is generally not taken into account and does not affect Benefits. However, you would not be able to claim Child Tax Credit or Child Benefit for a child if you are in receipt of a fostering allowance.
Foster carers may be in a position to claim any of the following benefits:
Income-Based Job seeker’s Allowance
Council Tax Benefit
Disability Living Allowance
Working Tax Credits