As a foster parent with FCA, you will get lots of financial support while fostering a child. Though a foster parent should never be motivated by financial gain, it’s essential for anyone who’s thinking about fostering to carefully plan their finances and take the time to understand how fostering effects things including taxes, benefits and financial planning.
Let’s answer some of the common questions about financial support for foster carers and some things you should consider when preparing to become a foster parent.
Do foster parents in the UK get paid?
Yes, foster parents in the UK are entitled to a fostering allowance for the incredible work that they do. However, fostering is not same as a traditional job, meaning that there are various benefits, including tax allowances, which foster parents are entitled to.
Here at FCA we offer a generous and competitive fostering allowance. By choosing an independent fostering agency , you’ll benefit from an increased rate of fostering allowance as well as a huge range of additional and ongoing support.
How much how much financial support do foster parents get?
Foster care allowances in the UK are made up of two separate payments:
A fee to cover expenses, which is designed to cover all of the costs associated with the care of the child you’re looking after; this covers their food, clothing expenses, activities and more.
A professional fee, which is our way of saying thank you to you for all of your hard work in caring for children. This money is for you and your family to spend however you choose.
The amount of money you’ll receive as a foster parent will depend upon a range of factors, including the age of the children you’re caring for and how many children you welcome into your home.
Try out our fostering allowance calculator to get an estimation of how much you could earn when you begin fostering.
Additional financial support for our foster parents
When you join FCA you’ll also receive a range of unique benefits, including:
- Two bonus payments each year (one in the summer and one in the winter)
- A calendar of free family events throughout the year
- The potential to earn up to £3,000 through our Refer-a-Friend Scheme
Our foster parents are STARS
Our foster parents also benefit from our STARS rewards scheme. This scheme includes:
Shine - our monthly ‘Time to Shine’ Awards celebrate the incredible contribution our foster parents make within our community, offering prizes and recognition of your achievements.
Together – As you reach milestones in your fostering journey, you’ll be rewarded with a personalised gift or experience.
Appreciation – We organise regular free events for our foster parents which take place across the UK to say thank you for all the hard work you do. These include lunch or afternoon tea – and there is always lots of cake!
Reward - In addition to the summer and winter bonuses, we also offer an annual appreciation bonus from £150 up to £1,000 depending on your length of service.
Savings – We reward all of our foster parents with access to our exclusive discounts scheme, giving you great deals on everything from your weekly shop to clothes, dining out and family theme park trips, making family days our even more fun and affordable!
Do foster parents pay tax?
If you’re wondering how fostering payments affect your tax, you’ll be pleased to learn that the majority of foster parents in the UK are exempt from paying taxes on the allowance they receive for fostering.
As a foster parent, you will be classed as self-employed, meaning that you will be required to register yourself with the HMRC and file a tax return each year outlining all of your sources of income. Because of a government scheme known as Qualifying Care Relief, unless you have a large household income, you will not be taxed on your fostering allowance. Learn more about tax allowance for foster parents.
Do foster parents have to pay National Insurance?
As a foster parent, being self-employed, you will not be required to pay National Insurance contributions unless your taxable income from fostering exceeds the government threshold.
While this may at first be seen as a bonus, we advise our foster parents to contact the HMRC and make arrangements to pay voluntary Class 2 National Insurance contributions. This will help ensure that you are entitled to a government pension, as well as other benefits in the future. A gap in paying your National Insurance contributions can affect your eligibility to receive contributory benefits.
Can UK foster parents claim benefits?
Though foster parents are not able to claim Child Benefit for the children they foster, you will still be eligible to claim other benefits when you become a foster parent. These benefits include PIP, Universal Credit and Child Benefit for your own children. You’ll need to contact your benefits provider to inform them that you’ve become a foster parent.
The money you earn through fostering will not be taken into account when calculating means-tested benefits, which include Housing Benefit and Income Support. Your eligibility for other benefits, including Maternity Allowance and Bereavement Support, will depend upon your level of National Insurance contributions.
Can I foster while working?
Many of our foster parents choose to carry on working while fostering; in fact, fostering can be a fantastic way of developing your career. Whether you’re eligible to foster and work will depend upon how flexible your work is and if you’ll be able to fulfil all of the needs of the children in your care while working.
Many companies now take part in the Fostering Friendly scheme, which aims to support employees who foster with benefits including paid time off for training and flexi-time opportunities. Speak with your employer to learn how they can support you to work while fostering.
Could you foster?
There are so many children up and down the UK who are waiting for loving foster homes. If you think you’ve got what it takes to become a fantastic foster parent, or if you’re curious about learning more, why not enquire with our friendly team today?
Ready to learn more about fostering and finances? Download our guide below to understanding finances as a foster parent.
