Fostering fees and allowances
There's no need to feel strange asking about the financial side of fostering. 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.
Understanding the breakdown of fostering allowance along with foster carers tax allowance will help you to understand how foster care could be an option for you and your family.
A guide to North East fostering fees and allowances
In our introductory guide to foster care fees and allowances, we will explain the self-employment status of foster carers and the changes it may mean for you. If you'd like a better idea of the financial implications of becoming a foster carer based on your own situation, we can arrange for you to speak to an assessing social worker in your area.
How much do you get paid for fostering in the North East?
Fostering is a professional role with responsibilities and the allowances paid by all of the partners within Foster with North East reflect this. Each local authority sets their own foster care allowance rates based on Government guidelines, so there's no fixed allowance for fostering in the North East.
In addition to an allowance, payments are also made to financially support you when becoming a carer.
All authorities within our partnership appreciate that many people give up or reduce working hours to become foster carers and offer financial packages.
Local authority foster care allowances in the North East
All partners are committed to paying fostering allowances in line with or above Government guidelines. All Foster with North East members also review the foster allowances whenever Government guidelines change.
If you're looking for allowance details of a specific North East local authority, we can put you in touch with an assessing social worker.
What does the fostering allowance cover? Fostering allowances and fees explained
Foster carers receive a fostering allowance for each child, and adult in the case of parent and child placements, who stays with them. The weekly allowances are paid on a monthly basis and cover the cost of caring for the child as well as providing an income.
- 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/young person
Fostering skills and other payments
Self-employment and paying tax and National Insurance on fostering allowance
All foster carers in the UK, whether working with a local authority like the partners in Foster with North East, or an agency, are classed as self-employed. 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. In fact, as a foster carer in the North East you can expect almost all your fostering income to be exempt from tax thanks to Qualifying Care Relief.
As a foster carer, compared to alternative employment with a similar salary, you would keep more of your fostering income.
Fostering finance facts:
- Households do not pay tax on the first £18,140 they earn from fostering each year.
- You also receive tax relief for every week a child is in your care.
- You could receive up to £25,000 per year with no tax to pay.
- The Government gives foster carers National Insurance Credits to build a state pension.
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?
You might be surprised to learn that people who claim benefits 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. You can find more advice on Becoming a Foster Carer.
Get more information about fostering payments and taxes
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.
Get in touch
Our team of fostering experts are also on hand to help if you'd like to find out more about fostering allowance, fostering tax relief and self-employment. Get in touch or give us a call on 0800 917 7771.
Share this page
