Don’t let tax be taxing

Foster carers are reminded that fostering services will be sending them a statement of payment for the tax year 2011/12, which ended on 5 April 2012, for use in completing their tax form.

Since April 2003, all foster carers have been treated as self-employed for tax purposes, and HM Revenue and Customs (HMRC) introduced a specific tax scheme for foster carers called ‘foster care relief’. In April 2010, this foster care relief was extended and renamed ‘qualifying care relief’.

The qualifying care relief covers foster care, shared lives care (formerly called adult placement), staying put care (where a young person who was fostered remains past their 18 birthday), and parent and child care (where the parent may be aged 18+, or the child may not be a looked-after child).

Many foster carers have little or no taxable profit from fostering, because of the level of the qualifying care relief, but all foster carers are expected to register as self-employed with HMRC, and must declare any profit. 

You can download the HMRC factsheet on tax relief for foster carers from the HMRC website.

Members of the Fostering Network may access the Income Tax and National Insurance Signpost booklet on this website for further information.

For further assistance, contact Fosterline on 0800 040 7675

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