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Questions about fostering allowance and payments

Finances when fostering is one of those topics that potential foster carers can feel shy to ask about. Please be reassured you don't need to feel embarrassed to ask questions about fostering payments and allowances.

We realise that becoming a foster carer may mean a change in how you manage your household finances. We want to direct you to all the information you need to make an informed choice so you can plan ahead. Here you'll find the most frequently asked questions about fostering and finance. 

How much do foster carers get paid?

As a Foster with North East foster carer, you'll be paid by the local authority you work for. The amount you receive will be based on the number of children and young people in your care and other factors such as their needs and age. 

All 12 partners should pay the Government National Minimum Allowance for the age of the child, which is between £154 and £270 per week. The fostering allowance is for the care of the child, to cover food, utility costs, clothing, transport, recreational costs etc.

As a North East foster carer, you can also expect to receive a weekly professional foster carer fee, which recognises specialist training and skills progression of foster carers. 


Additional holiday and birthday payments for foster carers

Celebrating birthdays, religious holidays and going on outings during the school holidays are important experiences for children and young people. We recognise these incur additional expenses and your local authority would be able to advise on their own policy. 


Do foster carers pay tax?

Almost all income from fostering is exempt from tax, thanks to Qualifying Care Relief from the Government to support foster carers. The Qualifying Care Relief (2023) gives households a tax exemption on the first £18,140 they earn from fostering. 

You also get tax relief for each week or part week a child is in your care, reducing the tax paid on any fostering earnings above this amount.


Can I afford to be a foster carer?

We value the vital and professional contribution our foster carers make across the North East region. We offer competitive pay as we want you to be able to focus on meeting the needs of the children in your care. 

We appreciate that many individuals and couples decide to give up work or reduce work outside the home to become foster carers. Qualifying Care Relief can make fostering a more affordable option for these families. 


How can I find out how fostering will impact my finances?

We understand that everyone's financial situation is different. Social workers across our Foster with North East network from each local authority welcome questions about pay and allowances. Please get in touch to chat about your circumstances, the financial implications of fostering and the different types of fostering in the North East.


How will fostering impact my benefits? 

If you are receiving benefits, you will not automatically lose those benefits if you become a foster carer, unless you are claiming job seekers allowance. You would not receive child benefit for children staying with you but you will receive a fostering allowance for their care. However, your fostering income should not stop you from receiving housing benefit or impact the child benefit you receive for adopted or birth children in your family.


Do I have to give up work to be a foster carer?

There is no typical fostering household. Sometimes foster carers choose to leave other jobs or reduce their hours to focus on being a foster carer or apply fostering after retiring. In some fostering families, one partner works outside the house full-time or part-time. 


Can I still work my current job and foster?

Where individual circumstances allow, foster carers can and do keep their current jobs alongside fostering. To find out if this could be an option for you, we would encourage you to discuss this at the beginning of the assessment process. 

What's important is that you can meet the needs of the children and young people in your care. The fostering assessment will consider how you can do this alongside any existing commitments and what types of fostering would be suitable for you.  You would work alongside your assessing social worker to agree what works best for you and your situation.


Will I be classed as self-employed whilst fostering?

As a foster carer, whether you work for the local authority or an agency, you are classed as self-employed and will need to register with HMRC.