What payment records will I receive for each foster placement?

A payment record is usually a statement, remittance advice or similar document issued by the fostering service for a placement. It should provide a clear breakdown of the sums due, rather than showing only a single total, and should correspond with the payment received in your bank account.

The exact format varies between fostering services and may also depend on whether payments are made by a local authority or an independent fostering agency. Before a placement begins, ask which documents you will receive, how often they are issued and which payment dates they relate to. Your fostering agreement and the placement agreement should explain the relevant payment arrangements.

A statement for a placement may include:

• Placement details: the relevant child or placement reference, placement start date and, where applicable, the end date or period covered. Sensitive information may be limited to initials or an identification number.
• Fostering allowance: the amount intended to meet the everyday costs of caring for the child, such as food, clothing, household use, personal items, travel and activities. The record may show the rate applied and the number of days or weeks included.
• Fostering fee: where the arrangement includes a fee for the carer’s time, skills or responsibilities, this should normally appear as a separate line from the allowance. Not every fostering arrangement includes a separate fee.
• Additional payments: agreed sums linked to the child’s assessed needs, specific equipment, activities, travel or other approved requirements may be listed separately. These should be supported by the relevant agreement or approval.
• Adjustments: a statement can show changes for a partial period, a change in the child’s circumstances, an agreed payment adjustment, an overpayment recovery or another correction. The reason should be identifiable or explained by the fostering service.
• Total due and payment information: the gross amount for the period, any deductions or recoveries that apply, the final amount payable and the date on which the payment was processed or is due.

Some costs are not included in the regular placement payment. For example, an approved expense may be reimbursed through a separate process and supported by receipts or an expenses form. Do not assume that a bank transfer represents every amount connected with a placement. Compare the statement with your placement records and retain supporting documents for any separate claim.

Check the record against the placement. When you receive a statement, check the dates, the child or placement reference, the rate used, the number of days covered and each additional item. Also compare the total with the payment received. This is particularly important where a placement starts or ends part-way through a payment period, where the child’s needs change, or where respite or other planned arrangements affect the amount due.

If something appears incorrect, contact the fostering service or the named payments contact and ask for a written explanation. Give the placement reference, the statement period, the amount shown and the amount you believe should have been paid. Keep copies of your query and any response. If a correction is made, retain the revised statement as well as the original so that your records show how the difference was resolved.

Keep payment statements with your wider fostering records, including placement agreements, approved expense claims, receipts and records of payments received. A bank statement confirms that money reached your account, but it normally does not explain what the money was for. The fostering statement provides that context and can help you separate allowances, fees, approved expenses and adjustments.

These documents can also help with tax and financial administration. Fostering income has specific tax rules, and the figures or records needed will depend on your circumstances and the type of fostering you undertake. Keep the information supplied by the fostering service and seek advice from HM Revenue and Customs or a suitably qualified tax adviser if you are unsure how to report or retain it. Do not rely on the payment record alone: keep relevant receipts and other evidence required for your own records.

Payment records should be handled securely because they may contain information about a child or their placement. Store paper documents safely and protect electronic copies with appropriate access controls. If you are unsure whether a payment is an allowance, fee, expense reimbursement or adjustment, ask the fostering service to identify it in writing before filing your accounts.