How much do foster carers get paid?

Foster Carers provide a nurturing supportive home for those children who need to be cared for when living away from their family.  For many, fostering brings enormous emotional rewards in helping a child or young person to flourish and feel safe, sometimes for the first time.

Fostering is not always easy, it is a career requiring commitment, resilience, a lot of hard work and training.  As well as caring and supporting the child on a daily basis, foster carers work as part of a multidisciplinary team, keeping records, attending meetings and reviews for the children and young people in their care.

Foster carers have a choice of who they foster with and have the option of registering with either a local authority in their area or an independent fostering agency.  The financial rewards for fostering are excellent but do vary depending on who you register with, independent fostering agencies usually pay a higher weekly fee than their local authority counterparts.

Foster carers are classed as self-employed and are paid a weekly fostering allowance which covers the cost of caring for the child or young person in their care and also provides a salary for the foster carer role.

How Much Is the Fostering Allowance?

The amount of fostering allowance you will receive varies depending on a variety of factors.

  • Type of placement – There are a number of different types of fostering placements attributing a variety of payments, with consideration being given to the following:-
    • Child’s age – The older a child in care is, the greater fostering allowance will be paid.
    • Child’s needs – Children with medical conditions or physical/learning disabilities will attract a higher fostering allowance to help the carer support their needs.
    • Area – Different areas in the UK have different ‘standard of living’ costs, so the fostering allowance may vary depending on the area you live.
    • Your fostering agency/local authority – Foster care payments are not regulated, local authorities and independent fostering agencies offer varying fostering allowances, with independent fostering agencies usually offering a higher fee than their local authority counterpart’s.
    • The number of placements – If you have the room and are approved for, (and accept) more than one placement, a fostering allowance will be paid for each placement you have.
    • Whether you are registered with an independent fostering agency or local authority.

Example average fees paid by Independent Fostering Agencies*

An independent fostering agency will normally pay the below example average rates:

Standard Placement

Up to
~£490per week

Equivalent of £25,480 per year

Additional Needs Placement

Up to
~£765per week

Equivalent of £39.780 per year

Two Unrelated Children Placement

Up to
~£980per week

Equivalent of £50,960 per year

Parent & Child Placement

Up to
~£700per week

Equivalent of £36,400 per year

*example pay rates are based on highest paying regions in the UK and fostering young people over the age of 14.

These below rate do not reflect the beneficial tax relief and exemptions you will receive as a carer (See below) making the fee even more advantageous.

Minimum Weekly Allowance as set out by the government

To add some context with the above outlined fees, every April the Government adjusts the absolute minimum that anyone should be paid as a foster carer in the UK.

These figures are for the tax year 6 April 2023 to 5 April 2024:

These minimum rates are routinely utilised by Local Authority Fostering services; however some local authorities will pay between the minimum fee as outlined above and the average fee paid by independent fostering agencies.

RegionAge 0 to 2Age 3 to 4Age 5 to 10Age 11 to 15Age 16 to 17
London£179£182£203£232£270
South East£171£177£195£223£260
Rest of England£154£159£175£199£233

Is Foster Care Pay Taxable?

In addition to the fostering income, UK foster carers also benefit from special tax rules.

Tax Exemption

UK Foster carers have a fixed tax exemption of up to £10,000 per year which means you do not have to pay tax on the first £10,000 income (after expenses) that you make from fostering.

Any tax exemption is shared between foster carers within the same household and not for each carer.

Tax Relief

In addition to this, carers will receive tax relief for every week that a child is in your care, meaning you do not have to pay tax on some of your earnings over £10,000.

For each foster child under 11 years old, the tax relief is £200 per week. For each foster child 11 or over, the tax relief is £250 per week.

Example Tax Calculation

Gemma is a foster carer for a 16-year-old all year and also looks after a 6-year-old child for 20 weeks of the year.

£10,000 (tax exemption) + £13,000 (Child 1’s tax relief (52 x £250)) + £4,000 (Child 2’s tax relief (20 x £200)).

Therefore, Gemma does not have to pay tax on the first £27,000 earned per year.

How Do I Get Paid?

Most fostering services pay you weekly, directly into your back account.

The fostering allowance is paid in a weekly single payment and covers both the support required for the child or young person and the fee paid to the carers.

  • One element of the fee should be utilised to cover the cost of caring for the young people in your care – Food, clothes, activities etc;
  • The remainder of the fee is paid to you for the work and support you provide in your role as a foster carer.

Some fostering services suggest that 60% of your fostering allowance should go towards supporting the young people in your care, but your weekly allocation to support the child or young person in placement is largely discretionary as long as they have everything they need.

What Other Financial Benefits Are There?

Most Independent fostering agencies, offer a range of additional financial benefits, including holiday pay, respite breaks, pension payments, start-up payments and additional payments for exceptional outings which benefit the child or young person in placement.

Holiday pay is provided by most agencies so that you have additional funds to be able to take your child or young person on holiday with the family.

Respite pay enables carers who have a possibly challenging child or young person in placement to have a ‘paid’ break, whereby another ‘respite’ carer will look after the child or young person for short periods.

The majority of Local Authorities do not pay additional financial benefits.

Initial Start Up Payments

Some fostering services offer an additional ‘start-up’ payment to support new foster carers beginning their first placement. This helps them to ensure they have all the items they need ready for their young person to arrive.

Pensions

Foster carers are eligible for National Insurance credits which count towards their state pension.

Foster carers will normally be allocated ‘Holiday Pay’ by most Independent Fostering Agencies.

Additional payments

Some fostering services offer additional payments to support events which have clear additional benefits to the foster children in your care. These could include:

  • Religious festivals
  • Support when going on holidays which include the child or young person in your care
  • Birthdays
  • School trips

Does Fostering Affect Benefits?

Many benefits remain payable if you become a foster carer. The government suggests using a benefit calculator to help workout which benefits you remain eligible for.

Universal Credit

Universal Credit is a means-tested benefit for working aged people who are on a low income.

Fostering income and allowances are not factored in when calculating entitlement to Universal Credit as are they are not considered as part of your ‘earnings’, therefore, if you meet the other eligibility rules you can still claim Universal Credit whilst fostering.

For instance, to claim Universal Credit you need to accept your Claimant Commitment which sets out responsibilities for you to meet. Fortunately, there are fostering specific allowances to help carers claim Universal Credit:

  • If you are caring for a foster child under 1 years old, you don’t have to do any work-related activity;
  • If you are caring for a foster child aged between 1-16, you only have to take part in work-focused interviews;
  • If you are caring for a foster child over 16 who has additional needs, and your work coach thinks it is therefore unreasonable for you to look for work, then you may only have to take part in work-focused interviews;
  • Foster carers have an eight-week concession from having to sign on as ‘available for work’ between placements. This means you can continue to receive Universal Credit even if you have a reasonable gap between your placements.

How much universal credit you will receive will be calculated by The Department for Work and Pensions (DWP) depending on your family’s circumstances.

Universal Credit has now replaced a range of benefits:

  • Child Tax Credit
  • Housing Benefit
  • Income Support
  • Income-based Jobseeker’s Allowance (JSA)
  • Income-related Employment and Support Allowance (ESA)
  • Working Tax Credit

As some people are still able to claim for these benefits or are still currently receiving them, we will detail how fostering affects them below.

Child Tax Credit

Child Tax Credit could be claimed if someone is responsible for a child or young person who lives with them. However, foster carers will not be able to claim Child Tax Credits for a child or young person being fostered as the fostering allowance they are paid is designed to fully cover the cost of caring for a foster child.

Housing Benefit

Housing Benefits has been replaced by Universal Credits and could previously be applied for if you lived in a rented property, had low income, and savings of less than £16,000.

The government previously reduced housing benefit for under-occupancy which inadvertently affected foster carers as foster children are not seen as members of the household, therefore their rooms were seen as ‘empty’. However, the government has since agreed that foster carers are allowed one ‘spare’ bedroom, so if you use a spare bedroom for fostering then it should have no effect on the Housing Benefit you are currently claiming.

Income Support

You can no longer claim for Income Support as it has been replaced with Universal Credit.

If you are currently still receiving Income Support, you may be able to continue to receive it if you become a foster carer as the DWP (Department for Work and Pensions) does not count fostering payments as income for Income Support purposes.

This means if you are fostering a child under 16 years old, you can retain your Income Support claim while you have a child in placement. Additionally, you can continue to claim Income Support if you do not have a placement and you are caring for your own dependent child(ren) under 5 years old, or a disabled young person.

Jobseeker’s Allowance (JSA) & Employment and Support Allowance (ESA)

Usually if you are working then you cannot claim for either Jobseeker’s Allowance (JSA) & Employment and Support Allowance (ESA), but as foster care is not treated as work in this context, you should be able to claim either benefit if you meet the other conditions for the entitlement.

Working Tax Credit

Working Tax Credit can be claimed by low paid workers to ‘top up’ wages.

Foster carers are eligible to claim Working Tax Credit (as they are technically self-employed workers) if they work at least 16 hours a week.

If you have more than one paying job, the total hours can be added together. You can also include the hours inherit to self-employment, such as hours spent cleaning and book-keeping.

Child Benefit

Generally, you will not be able to claim Child Benefit for a foster child as the GOV.UK site states you are only eligible if your fostering service is not paying anything towards your foster children’s accommodation and maintenance.

However, foster carers can still claim Child Benefit for their own children and any other children who live with them (who are not fostered children).

Disability Living Allowance (DLA), Personal Independence Payment (PIP) & Attendance Allowance

If you claim Disability Living Allowance (DLA)Personal Independence Payment (PIP) or Attendance Allowance, then your benefits will not be affected by fostering a child.

Do Foster Carers Pay Council Tax?

Like other benefits, fostering income is not considered when council tax relief is calculated.

Foster carers can receive Council Tax Relief if they are on low income or claim benefits, and in some cases can avoid having to pay council tax at all.

The amount you are able to claim varies on the local authority, your personal circumstances, your savings/pensions/partner incomes, and if there are other children or adults in the household.

To apply for a council tax reduction, follow this link to the GOV.UK website.


This information is provided for guidance only and should not be deemed as financial or state benefits advice. As each individuals circumstances are different, we do advise that personalised information should be sought from the Department for Work and Pensions.

Do You Have Any Further Questions?

Let us know a time that suits you and one of our approved foster agencies will be in touch to give you any information or support that you need.