Fostering Tax Allowance and Benefits
As a foster parent with Excel Fostering, you’ll not only be paid a weekly allowance, but you’ll also be eligible for fostering tax allowances and benefits. This financial support for foster carers is there to help you focus on the important things, such as looking after the children and young people you foster, rather than needing to worry about your finances. In short, they’re there to make your time as a foster parent that little bit easier! Learn more about fostering allowance and benefits from our detailed guide.
Foster care tax allowance
As a foster carer, you’re classed as a self-employed professional. This means that you’ll be entitled to foster care tax relief on your fostering income and will pay little, if any, income tax on your earnings depending on the number of placements you are currently caring for. You’ll also be eligible to receive relief on your national insurance payments. The value of your discount will vary on your financial situation as well as your household income and you will need to fill out a yearly tax return to ensure that you receive the proper allowances.
How much foster care tax allowance will I receive?
The total tax relief you qualify for as a foster carer is made up of two parts.:
- Fixed tax exemption – the first is a fixed tax exemption of £10,000 per year which is shared across all carers within a household, this means that you won’t need to pay any tax on the first £10,000 you earn for providing fostering services.
- Weekly tax relief – on top of this fixed rate, you will also qualify for additional weekly tax relief. This is applied for every whole or partial week that a foster child or young person is in your care – meaning that you can qualify for tax-free earnings above that £10,000 fix rate. This foster care tax relief is set at £200 per week per child under 11 years of age, and £250 per week per child over 11 years of age.
Do I qualify for benefits or tax credits as a foster carer?
Becoming a foster carer does not prevent you from qualifying for benefits or tax credits – though it may affect the amount of money that you are able to claim. If you are currently receiving benefits from the local council, a voluntary organisation or a private company on behalf of your local council, then these benefits will not be impacted.
If you currently claim jobseeker’s allowance, income support or receive an employment and support allowance, then being a foster carer may change how you claim these benefits – for more information on this, contact our dedicated support and advice team by calling 01253 712734. As a foster parent, you will also still be able to claim child tax credit for your own children as well as national insurance credits which count towards your state pension.
As a member of the Excel Fostering carer team, you’ll also be provided with a range of other support services, including specialist training courses to help teach and guide you through the world of foster care.
Want to know more about fostering allowance and benefits? Our trusted expert team can help. Alternatively, find out more about how much foster parents get paid and more from our detailed guide. Perhaps you’re interested in becoming a foster carer with Excel? If you’re over the age of 21, are in good health and have a spare bedroom in your home, then you could change the lives of children in your area. Contact us today.