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Fostering - Tax benefits

Foster Carer Tax Relief

As a foster carer you'll be entitled to tax relief on your income from fostering, meaning you'll pay very little (or no) tax and national insurance.

You'll need to register as self-employed and you'll be asked to complete a tax return.

The tax relief you get depends on your own financial circumstances.

Tax exemption

There is a fixed tax exemption of £ 10,000 per year (less for a shorter period) which is shared equally among any foster carers in the same household. This means you don't have to pay tax on the first £ 10,000 income you make from fostering.

Tax relief

As well as the tax exemption, you'll also get tax relief for every week (or part week) that a child is in your care. This means you don't have to pay tax on some of your earnings over £ 10,000.

Support from HM Revenue and Customs

Help and support is available from HM Revenue and Customs, helping foster carers with self-assessment and tax returns, eLearning, live events to enable foster carers to ask questions to a team of experts.

Tax for foster carers (eLearning)

HMRC help and support