Are there financial requirements to become a foster parent?

Financial eligibility for fostering is based on the overall sustainability of your household circumstances, not on meeting a particular salary threshold. The assessment looks at how your household is managed, whether you understand the financial responsibilities involved and whether fostering payments can be used appropriately to support a child in your care.

What is considered during the assessment?

You will usually be asked to provide a clear picture of your household finances. This may include income, regular expenditure, loans, credit commitments, savings, benefits and other relevant financial responsibilities. The purpose is to understand your circumstances and identify any issues that may need to be discussed before approval.

Financial information is considered alongside the rest of your fostering assessment. It is not viewed in isolation, and having a mortgage, rent, household bills or other commitments does not automatically prevent you from fostering. You should be able to explain how your household budget works and plan for changes in spending, including costs connected with caring for a child.

How fostering payments work

Approved foster carers normally receive fostering payments for each child placed with them. These payments are intended to contribute towards the costs of caring for the child, such as food, clothing, personal items, travel, activities and household expenses. The amount and structure can vary according to the fostering provider, the type of placement and the child’s individual needs.

Some fostering arrangements may include separate elements, such as an allowance for the child’s day-to-day costs and a payment that recognises the carer’s role. Your fostering provider should explain its current allowances, payment arrangements and any expenses that can be claimed before you make a decision.

Fostering payments should not be treated as an unrestricted replacement for employment income. You will need to understand what is covered, when payments are made and how expenses are handled. It is also sensible to consider the possibility of gaps between placements or changes in the type of placement you accept when planning your household budget.

Tax, benefits and employment

Fostering has specific tax rules, and eligible foster carers may be able to use fostering-related tax reliefs. The treatment of your payments depends on your circumstances and the rules in force at the time, so obtain current guidance from HM Revenue and Customs or a qualified adviser rather than relying on a general estimate.

If you receive benefits, fostering payments may be treated differently from ordinary employment income, but the effect can depend on the benefit and your personal circumstances. Check with the relevant benefits service before applying or before your circumstances change.

You may also be able to continue working while fostering, depending on the child’s needs, the type of placement and the expectations of your fostering provider. Consider whether your working pattern allows you to attend training, meetings, appointments and school-related activities, as well as respond to the practical demands of fostering.

Costs to plan for

• Food, toiletries, clothing and other everyday items for the child.
• Travel to school, family contact, appointments and activities.
• Equipment or changes needed to provide an appropriate bedroom and safe home environment.
• Activities, celebrations and social opportunities that help the child take part in family life.
• Possible changes to working arrangements, transport or childcare.

The exact arrangements for these costs should be discussed with your fostering provider. Keep records of questions you want answered, including what the allowance covers, whether additional expenses can be reimbursed and how exceptional costs are agreed.

Preparing your financial information

Before an assessment begins, gather details of your regular income and expenditure and make sure any financial information you provide is accurate and up to date. Be open about significant commitments or changes that could affect your circumstances. Early, honest discussion allows the assessing team to explain what support or planning may be needed and helps you make an informed decision about whether fostering is suitable for your household.

Become A Foster Family can provide further guidance on the financial part of the fostering assessment, current fostering allowances and the questions to ask before applying.