Foster Carers (Info)

Treat foster carers as being in qualifying remunerative work. The number of working hours declared on the claim form should be accepted. Normally a fostering arrangement will be with a Local Authority (LA), who may pay an allowance to the carers for the maintenance of the foster child. The allowance may also include things such as any special requirements of the foster child and the cost of wear and tear on the home.

Many foster carers are classed as being self employed. The Foster Care relief is an exemption against their self employed profits. This will result in many foster carers having ‘nil’ income for tax credit purposes.

Claiming for a foster child

If a child or young person

• Has been placed by a Local Authority under legislation

And

• The Local Authority is making payments for that child’s or young person’s accommodation and maintenance

The foster parent is not classed as being responsible for that child or young person for tax credits. This means that they cannot include the child on their claim

A claimant who is not receiving monetary support for the child may be able to claim tax credits and should include the child on their claim

Claiming for a young person the claimant is fostering or considering adopting

A claimant may be able to claim for a child or young person who has been placed with them by a Local Authority if

• They are being placed with them just for fostering
   
• While they foster them they decide to adopt them

Or

• They are placed with the claimant directly for adoption

Provided that either

• The child or young person was being looked after by the local authority and fostered under Part III of the Children Act 1989, Part II of the Children (Scotland) Act 1995, or Part IV of the Children (Northern Ireland) Order 1995

And

• The cost of the child or young person’s accommodation or maintenance is not being met in part or in full by one of the following

• Out of local authority funds under Section 23 of the Children Act 1989, or Section 26 of the Children (Scotland) Act 1995
   
• In Northern Ireland, by an authority
   
• Out of public funds

Or

• The child or young person was not being looked after by a Local Authority but was placed for adoption by them

And

• The Local Authority is not making a payment in respect of the child or young person’s accommodation and / or maintenance under Section 23 of the Children Act 1989, Section 26 of the Children (Scotland) Act 1995, or Article 27 of the Children (Northern Ireland) Order 1995

If the claimant is not sure whether any of the above conditions apply, they should contact their Local Authority welfare officer, who will be able to advise them