Help and support for foster parents in England
Tax arrangements
You should have registered as self-employed when you started to foster. You’ll need to file tax returns. Check with your fostering service what you need to do.
In your tax return, you’ll be able to claim:
- a tax exemption of up to £19,690 per household
- tax relief for every week you foster a child
This is known as qualifying care relief.
You may be entitled to National Insurance credits, which count towards your State Pension.
Tax exemption
In a tax year, households do not pay tax on the first £19,690 they earn from fostering. You’ll still pay tax on money you earn from a job or investment.
Tax relief
On top of the £19,690 exemption, you also get tax relief for every week (or part week) that a child is in your care. This means you do not usually pay tax on your earnings from foster care, even if they go over £19,690.
| Age of child | Tax relief |
|---|---|
| Under 11 | £415 per child |
| 11 or over | £495 per child |
Example
Laura is a foster carer for a 14-year-old for the whole of the year and for an 8-year-old for 10 weeks of the year. She gets:
Tax exemption for the household = £19,690
Tax relief on what she earns for fostering the 14 year old (£495 x 52 weeks) = £25,740
Tax relief on what she earns for fostering the 8 year old (£415 x 10 weeks) = £4,150
Altogether, Laura does not need to pay tax on the first £49,580 she earns from fostering.