Foster carers and prospective foster parents sometimes express how the conversation of money is uncomfortable to do. But we’d like to reassure you that it’s fine to ask about pay and allowances – in fact foster carer pay is vital.
At Fostering Dimensions, we support our foster carers in more ways than one. The pay you receive as a foster carer covers aspects of fostering like fees and allowances. Additionally, in recognition of the dedication and love you show for foster children and for the skilled, demanding, and essential work that you carry out.
The payment you receive from Fostering Dimensions will be made up of two elements:
When you foster, the amount in which you receive will always be enough to cover the cost of everything you need to be able to care for a child or young adult. The essential care allowance covers the costs for things from food, clothes, transport to personal things and household expenses. The second element to the foster carer pay, the foster carer fee, is for the time, dedication and skill you bring when fostering a child.
There are elements that will determine the amount that you receive and this can vary for each foster carer. Throughout the assessment and process, it will depend on a number of factors, including the type of placement, your own situation, the age of each child or young adult and the complexity of their needs and requirements. Fostering Dimensions fees and allowances are calculated on a daily rate and is paid weekly.
In addition to the fees and allowances, you will also be entitled to a range of extra payments covering everything from a birthday allowance, festival allowance, holiday allowance, and some additional travel costs.
As a foster carer, you are classed as self-employed and are paid on a weekly basis, while you have a child in placement. It is important to remember that you will not be paid any fees or allowances for any period that you do not have a placement.
There is a multi-step process for applying to become a foster carer and in order to determined the right foster carer pay, we discuss your financial circumstances within your application and assessment process. There are also other elements that are discussed in confidentiality such as how you will cope during periods without a placement.
Foster carer pay and earnings are calculated differently when it comes to tax and are subject to specific tax arrangements. In most instances, you pay little to no tax at all on your income from fostering. The way in which it is calculated is dependant on how much you get. If you earn anything up to £10,000 or above per annum from fostering, you don’t have to pay any tax on first £10,000 after expenses due to a fixed tax exemption.
Alongside the £10,000 exemption, as a foster carer, you will also receive tax relief of up to £250, per week, per child in your care. This means if you have a child aged 5 or above, in your care for a whole year, you wouldn’t pay tax on your earnings from fostering which is up to £23,000.
Depending on your financial circumstances, if you are currently receiving benefits, these may still be paid alongside your fostering payments. Click here for further information about working out your taxable income and eligibility for claiming working tax credit. Please note the minimum fostering allowance rates are quoted by the gov.uk on the link above – however Fostering Dimensions pays foster carers a more competitive fee than what is stated on the gov.uk website.
1 child in a standard placement
1 child with more complex needs
Parent and child placement
Follow the link below for an easy online step by step explanation of tax specifically for Foster Carers. The guide is written and produced by the HMRC as an e-learning tool.Tax for Foster carers learning tool