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Campaign objective

To build on past successes to ensure that all foster carers get a fair deal, and do not pay tax on allowances.

What kind of help do foster carers need with taxation?

We are not campaigning for fostering to be tax-free. However, we believe that foster carers should not pay tax on allowances paid for the children they foster. Although the majority of foster carers no longer pay this tax, there remains a percentage who may have expenses higher than the current exemption threshold. We continue to campaign to find a solution for this percentage of carers.

What we've achieved

  • Before the Fostering Network began campaigning on taxation, there were different tax arrangements in place in each local authority. This system was unfair. Two carers in two different local authorities could be paid the same amount of money, but one could be taxed more than the other
  • The Fostering Network lobbied to ensure that a fairer system was put in place. We worked with the Department of Health and the Inland Revenue to work out a new taxation threshold for foster carers
  • The thinking behind the new threshold was that no foster carer should be taxed on allowances for the child
  • The intention was that the threshold would take all the costs of looking after a child into account, so it was set at £10,000 threshold plus £200/250 per week per child.

Why do we still campaign on taxation?

  • There are still foster carers who have costs which exceed the threshold
  • We believe that no foster carer should be paying tax on allowances for the children they foster.

Immediate goals

We are continuing to negotiate with the Inland Revenue about the outstanding issues surrounding foster carers and taxation. We aim to reach an agreement that will mean these remaining carers do not pay tax on allowances for the children they foster.

For more information

The Fostering Network is eager to hear from any foster carers whose costs are not covered by the threshold. If you could help us with this, or want more information, you can email policy and campaigns manager Adam Hug directly, or call 020 7620 6434.