Fostering pay and allowances explained

One of the first questions people ask is a fair one: can I afford to foster, and what am I actually paid? This guide explains how fostering payments work in the UK, so you know what to expect. Exact figures change each year and vary between services, so we explain the structure and point you to the official sources for current amounts.

Two parts: an allowance and a fee

Most foster carers receive payment in two parts:

• A fostering allowance. This is money to cover the cost of caring for a child: food, clothing, activities, travel, a share of household bills. It belongs to the child's care, not to you as income.
• A fostering fee. This is a payment for your time, skill and commitment as a carer. Not every placement includes a fee, but most carers receive one, and it is usually what people mean by being "paid" to foster.

Together these are paid weekly, for each child in your care, while a child is placed with you.

The national minimum allowance

The government sets a national minimum fostering allowance that every foster carer should receive at least. It varies by the child's age and by where you live (London, the South East, and the rest of the UK are set at different rates), and it is reviewed every April. Many fostering services pay above the minimum.

Because the figures change each year, check the current rates on the official guidance at gov.uk rather than relying on a number you read somewhere once.

The fee varies by service and by placement

The fee on top is set by each fostering service, so it differs between a local authority and an independent agency, and from one agency to another. It also tends to reflect:

• the type of fostering (for example emergency or specialist therapeutic fostering usually pays more, see our guide to the types of fostering),
• your experience and the training you have completed,
• the needs of the child placed with you.

Independent agencies often pay more than local authorities, but not always, so it is worth comparing. A service will tell you exactly what you would receive before you commit.

Tax: why many foster carers pay little or none

Fostering has its own generous tax scheme, called Qualifying Care Relief. Foster carers register as self-employed, but the relief gives you a fixed tax-free amount each year plus a weekly tax-free amount for each child in your care. For many carers this covers most or all of what they receive, so they pay little or no tax on their fostering income. There is also National Insurance to consider.

The thresholds are set nationally and change, so check the current position on the official foster carers' tax guidance at gov.uk. It is also worth a conversation with your fostering service, who are used to explaining this.

Extras and the gaps between placements

Depending on the service, allowances can include extra amounts for a child's birthday, holidays and religious festivals. What you need to know going in:

• Payments are made while a child is placed with you. Between placements there is usually no allowance, though some agencies offer a retainer.
• The allowance is meant for the child's care, so good record-keeping helps.

The honest summary

Fostering is not a way to get rich, and no reputable service will pitch it that way. It is paid properly, though: a weekly allowance for each child, usually a fee on top for your time, and a tax scheme designed to be fair to carers. For most people the right question is not "how much will I earn" but "can I give a child a stable home, with the payments making that possible". If the money side is what is holding you back, talk it through with a service, who will give you real figures for your situation.

Next steps

Ready to find out what fostering would look like for you? Start your enquiry and a fostering advisor will talk you through it, or browse fostering agencies in your area to compare. New to all this? Start with how to become a foster carer.

This guide is general information, not financial or tax advice. Fostering allowances, tax relief and thresholds are set nationally and change, so always confirm the current position at gov.uk or with a fostering service.