Fostering Allowance

How much do Foster Carers get paid?

The exact amount of fostering allowance offered to carers varies depending on the type of placement, age of the child and the child’s individual needs. Whatever the circumstances, our payments to our carers are amongst the highest in the industry. Generally, the older the child or young person the higher the weekly fee.

Foster fee examples:

Additional needs fostering
Foster carers who care for children and young people who display complex challenging behaviours will receive an enhanced weekly fee of up to £765.00 per week. In such instances, we will only ever place 1 child at a time to ensure the highest level of support is provided to the carer and young person. For this type of placement, the foster carer will have no other children living in the home.
As an example, a foster carer who has one Enhanced Fostering placement (solo) child aged 13, will receive an average of £765.00 a week, which with HMRC tax relief, equals a potential income of approximately £40,000.00 per year.

Standard fostering allowance examples

Child/young Person – standard needs
A foster carer who has one child aged 13, will receive an average of £460 a week, which with HMRC tax relief applied to fostering will equate to an annual salary of over £29,000.00 per annum.

Due to HMRC Tax Relief for Fostering, £23,000.00 of this income would be TAX FREE. Comparing this to an employed person on PAYE the take home fee equals that of an annual salary over of over £29,000.00 per annum.

Children or young people – standard needs
A foster carer that has two unrelated children aged 11 and 14, in placement, will receive an average of £460 a week per child and would subsequently equate to a potential income of approximately £48,000.00 per year. Due to HMRC Tax Relief for Fostering, £36,000.00 of this income would be TAX-FREE. Comparing this to an employed person on PAYE your take home pay equals that of an annual salary of over £67,000.00 per annum.

How Does The Allowance Work?

As a Swiis foster carer, you will receive a combined allowance each week. This is split into two parts, one which covers the costs of caring for the children or young people and should be utilised for all their food, clothes, activities and other sundries, the other is a fee paid to the carers for the support they provide for the carer role. 60% of the fostering allowance should be allocated towards supporting the child or young person in placement, however guidance in terms of how the allowance should be utilised is provided to you in writing at the commencement of the placement. The weekly allocation of the allowance is discretionary.

Employed or Self-Employed?

Foster carers are classed as self-employed and receive considerable tax relief on any income earned as a carer. Swiis further provides a number of other ad hoc payments to our carers to help towards the exceptional costs of looking after children. This may include support towards clothing, equipment and activities, in particular, if a carer takes the child or young person on holiday, payments towards this will be considered if the costs are exceptional. All additional payments are made on a case by case basis and will be in addition to your weekly fee.

All new carers taking their first placement will receive a start-up payment of £200 to help with the initial costs of fostering, such as equipment or essential sundries. Many other fostering organisations do not provide such enhanced benefits to its carers.

Tax and Benefits

Fostering allowances and fees received for fostering are fully disregarded for the purposes of calculating entitlement to means tested benefits and where a (Secondary) foster carer may be searching for work, they can continue to receive jobseeker’s allowance, income support and employment and support allowance.

Tax exemption

There’s a fixed tax exemption of up to £10,000 per year which is shared equally among any foster carers in the same household. This means you don’t have to pay tax on the first £10,000 income (after expenses) you make from fostering.

Tax relief

As well as the £10,000 tax exemption, you will receive additional tax relief for every week (or part week) that a child is in your care. As a result, this means you don’t have to pay tax on some of your earnings over £10,000.

Pensions

If you foster, you will be eligible for National Insurance credits, which counts towards your State Pension.
The HMRC have also created a dedicated Foster Care eLearning package which offers Foster Carers guidance, advice and practical tips relating to tax and National Insurance.

Miscellaneous

All new foster carers will receive an additional £1,000 Welcome Support for help with their first placement. This is to ensure that the carers have everything ready for the first placement. Transferring carers should please contact the Swiis office directly for more information. Additional payments will be made if a child or young person arrives without the necessary clothing or equipment, (such as car seat for younger children). All additional payments will be determined on a case by case basis.

Support

Additional payments may also be made to foster carers who take the child or young person on a holiday which has a significant attributable cost. We believe that where possible, all children and young people should have the opportunity to be part of a family holiday and experience opportunities that they would not have otherwise had.