Are fostering fees separate from foster care allowances?

Usually, a fostering payment can contain two distinct elements: a foster care allowance for the costs of looking after a child and a fostering fee paid in recognition of the carer’s role. However, not every fostering service presents these elements separately. Some combine them into one total payment, while others show the allowance and fee as separate entries.

The terminology can also vary. A fostering service may refer to the overall amount as a fostering payment, maintenance payment, allowance, fee or weekly payment. This means that the word “fee” does not always indicate an additional amount on top of the published allowance. The important point is to establish what each part of the payment is intended to cover and whether it is included in, or added to, the stated total.

What is the foster care allowance?

The allowance is intended to contribute towards the everyday costs of caring for a child or young person. Depending on the fostering service’s policy, this may include food, clothing, personal items, household costs, travel connected with the placement, activities and other expenses associated with meeting the child’s needs. It is not normally treated as a wage for the carer’s time.

The amount may depend on factors such as the child’s age, the placement type and the needs identified in the child’s care plan. You should ask how the service expects carers to budget for larger or unusual expenses, including equipment, journeys, activities and costs linked to contact arrangements.

What is a fostering fee?

A fostering fee generally recognises the work, responsibility, skills and commitment involved in fostering. It may be described as a professional fee, carer fee or reward element. Whether it is paid separately from the allowance depends on the fostering service and its payment structure.

A separate fee does not necessarily apply to every placement or every carer. Some services use different payment levels according to the carer’s approval, experience, training, the type of placement and the complexity of the child’s needs. A fee may also be linked to specific placement arrangements or additional responsibilities. The written payment information should explain when it applies and whether any conditions are attached.

How the two elements may appear in practice

• Separate amounts: the allowance is listed for the child’s expenses and the fostering fee is shown as a different payment to the carer.
• One combined amount: the service publishes a single weekly or monthly figure without dividing it into allowance and fee.
• Different rates: the amount changes according to the placement’s age range, type, complexity or the carer’s approved level.
• Additional agreed payments: particular costs or responsibilities may be considered separately under the service’s policy, rather than forming part of the standard allowance.

These structures can make comparisons difficult. A larger advertised total does not necessarily mean that the allowance itself is higher, and two services using the same word may mean different things by it. Compare the full payment arrangement, not just the headline figure.

Questions to ask before applying

• Is the published figure an allowance, a fee, or a combination of both?
• What costs is the allowance expected to cover?
• Is the fostering fee paid for every placement, and are there eligibility or approval conditions?
• Does the payment change for different ages, placement types or levels of need?
• Are there separate arrangements for start-up items, travel, activities, contact or exceptional expenses?
• What happens to each element when a placement ends or a child is temporarily away?
• When are payments made, and are any amounts dependent on records, approvals or agreed tasks?
• Which parts may need to be declared for tax purposes?

Ask for the current payment policy and have the figures explained during the assessment process. This gives you a clearer basis for household budgeting and helps distinguish money intended for the child’s care from any fee connected with your role as a foster carer.

Payment information should be considered alongside the wider responsibilities of fostering. Before approval, prospective carers are assessed, trained and given information about the support available to them. The assessment also considers whether their household can meet a child’s needs safely and consistently; payment is only one part of deciding whether fostering is suitable for them.

Tax treatment can depend on the nature of the payments and the circumstances of the foster carer. Fostering services should explain how their figures are described, but independent tax advice may be appropriate if you need guidance about your own position.