Money Matters and Insurance


Contents

  1. Introduction
  2. Sutton Allowance Rates Allowances
  3. Allowances
  4. Holiday Allowance
  5. Pocket Money
  6. Christmas/Festival Allowances
  7. Birthday Allowance
  8. Travel Expenses
  9. Equipment
  10. Initial Clothing Allowance
  11. Passports and Documents
  12. Income Tax
  13. Claiming Benefits While Fostering
  14. Pensions
  15. Receipts
  16. Insurance


1. Introduction

Once you have completed the preparation training and the fostering induction standards and have a child placed with you, you will receive at least the minimum fostering allowances listed in the tables below. Allowances are usually made up of two components.  The basic age related child allowance and the competence payment relating specifically to the foster carers tier level within the progression scheme.

If you have any queries about allowances or if you think you have been under or over paid, contact the finance section in the fostering service as soon as possible.

Payments to you are made in arrears, direct to their bank or building society.


2. Sutton Allowance Rates Allowances

Please see our Finance Guide for the current allowances and fee paid to foster carers who are registered with the London Borough of Sutton.

For additional information about the finance policy and for guidance and expectations of how the allowance is to be used, please see our Finance Guide.


3. Allowances

While a child is Looked After, they are entitled to a number of other allowances.

The level of these payments is reviewed once a year.

Click here to view the allowances.


4. Holiday Allowance

This can be applied for once a year. You should let your Supervising Social Worker know when you plan to take a child/young person on holiday and they will arrange payment. The amount payable depends on the age of the young person.


5. Pocket Money

Please ask your Supervising Social Worker about rates and allowances.


6. Christmas/Festival Allowances

This should be included in the first payment in December or the relevant month if another festival is celebrated.


7. Birthday Allowance

This should be made with the payment immediately before the date of the child's birthday.


8. Travel Expenses

Expenses are paid by the fostering service for making trips to hospital; attend reviews, contact arrangements or other exceptional travel expenses. This will be at a set rate per mile.


9. Equipment

Expenses are paid by the fostering service for making trips to hospital; attend reviews, contact arrangements or other exceptional travel expenses. This will be at a set rate per mile.


10. Initial Clothing Allowance

When a child first arrives there may be a need for extra money to buy clothes. Please discuss this with your Supervising Social Worker.


11. Passports and Documents

The cost of getting birth certificates (and copies), passports and Life Story books will be met by the fostering service.


12. Income Tax

You should pay no tax on the money you earn from fostering. You can be exempt from tax on all or most of your fostering income, depending on:

  • how many children you look after;
  • whether or not it is a full tax year;
  • whether or not there are other foster carers in the same household.

There is a fixed tax exemption of up to £10,000 per year (less if for a shorter period) which is shared equally among any foster carer’s in the same household. After that, you get tax relief for every week (or part week) that a child is in their care. For every week (or part week) that a child aged 11 or older is with them, your tax relief is £250 per child. For every week (or part week) that a child aged under 11 is in their care, the tax relief is £200 per child.

All payments made to you will be itemised. You should keep this information as a record for income tax purposes.

Please see: Foster Carers Relief Information (HMRC).


13. Claiming Benefits While Fostering

See relevant information on the GOV.UK website.


14. Pensions

If you foster you may be eligible for National Insurance Credits which count towards your State Pension.


15. Receipts

You should keep a record of how the allowance is being spent on a child/young person. You should keep receipts where possible. The child/young person should sign for money they are given e.g. pocket money and clothing allowance. This helps build a record of what has been spent, which you can show if asked about it at a later date.

If you are in receipt of the Disability Living Allowance, you may find that fostering affects your entitlement.

If you are in this situation you should seek advice from the Benefits Agency or Citizens Advice Bureau (CAB).


16. Insurance

You must inform your Home, Building and Contents and Car insurance company once you have been approved as a foster carer.

Tell them about the numbers of children and age ranges you expect to take. You should ask the insurance companies for written confirmation that they have included foster children on your policies. A copy of these letters should be given to your Supervising Social Worker.