BIM52770 - Care providers: Foster carers: calculating the exemption
The exemption is calculated by reference to the income period.
The legislation provides for the level of the exempt amounts
to be varied.
Where profits from foster care would be assessed under
Schedule D Case I/II the income period is the same as the basis
period, where profits would be assessed under Schedule D Case VI
the income period is the year of assessment.
The exemption for foster care profits that would be assessed
under Case VI is given by the exempt amounts shown in
BIM52765 that are in effect for the year
of assessment, with the fixed amount reduced proportionately if
necessary.
For a Case I/II source the exempt amount is calculated by
adding together:
- the fixed exempt amount for each year of assessment that the income period falls within, apportioned for the amount of the period that falls within the year of assessment, and
- the weekly amounts for each child based on the amounts in force for the year of assessment for the weeks they were cared for.
A week is a period of seven days beginning on a Monday, periods
of care less than a week are treated as a week.
There is only one fixed exemption available per residence,
where more than one foster carer is using the same residence for
foster care the fixed exemption is split equally between the foster
carers.
2003/04
For the purpose of calculating the amount assessable for
2003/04; where the basis period for 2003/04 begins prior to 6 April
2003 the exemption for the income period is the fixed exempt amount
for 2003/04, plus the 2003/04 weekly amounts applied throughout the
basis period.
