Money Matters and Insurance

1. Introduction

Once approved, foster carers should immediately register (if they are not already registered) as ‘self-employed’ with His Majesty’s Revenue and Customs. Foster carers in the UK are obliged to do this under law and the date that foster carers register should mirror the date of approval to enable foster carers to access the full amount of allowances they are entitled to in any given financial year.

Foster carers will need to provide Children Always First with their bank account details in order for BACS payments to be made in respect of fostering duties undertaken. Email is the preferred method of notifying foster carers of payments due to them and this should be provided on approval if possible.

2. Advance Payments

You may request an advance when a child moves into your home and this can be agreed as needed by the Registered Manager. It will be repaid in full within the next three months payments depending on the amount advanced, and by negotiation. This arrangement is intended to bridge any significant gap between the time the child moves in and the next available monthly foster carer payment date, as we understand that the first couple of weeks of any placement can be expensive.

Foster carers can request this service by contacting the Registered Manager, should they not have been offered this as a matter of course.

3. Payments to Foster Carers

Payments to you, come under one of these headings and are defined as follows. The full amounts of the payments are detailed in Carer Payments in the Useful Resources section.

Foster Carer Fee

This is the element of the ‘professional fee’ that you receive for providing care to the child/young person.

National Minimum Allowance (child allowance)

Click here for the national minimum fostering allowances.

This is the element of ‘maintenance’ designed to meet the daily living costs of the child within your household, e.g. clothing (including reasonable school uniform where appropriate), food, personal care, household costs such as electricity, gas, water rates, insurances, pocket money, savings, over the counter medication, travel, hobbies, festivals, activities and holidays etc.

Expenses

These are typically the travel expenses of the Foster Carer (see below Car Mileage). However, payment of additional costs can also be made (see below).

Additional Costs

Payment of additional costs must be approved in advance by Children Always First management and will be made following the receipt of an expenses claim (Additional Costs Form). You will need to send this to the office to be authorised by the Registered Manager.

Payment Arrangements

Your fees and allowances are paid monthly in arrears, on the nearest working day to 28th of that month. You will receive a payslip that details your payments and any additional costs/expenses that have been submitted by 10th of that month. Any advance payments will be deducted from your payment and will also be detailed on your payslip.

If you have any queries about allowances or if you think you have been under or over paid, contact the office as soon as possible.

Overpayments

When a child has moved on and you have received any advance payments, or an overpayment has been made, it is an expectation that you will make arrangements to reimburse Children Always First.

Repayments will normally be deducted from your next remuneration. In such circumstance that you resign from the agency whilst still owing such overpayments, Children Always First reserves the right to seek reimbursement of such monies owed and to take legal action in pursuit of such, where necessary.

Foster Carer Annual Leave/Respite

You are entitled to up to 14 days paid annual leave each year. With Children Always First we call this your annual leave and it is accrued pro-rata (from the date a child starts living with you) and is arranged in respect of full-time placements only. You are able to access this paid Annual Leave in one of two ways:

• Option 1: Access Respite Provision
  
  You are able to access respite for the children in your care for up to 14 days per year. This can be used for you to take time for yourself or even go on holiday. To arrange respite for the children you are caring for, we do need to know in advance, particularly around the school holiday periods. It is preferable that 4 weeks’ notice is given for us to arrange any respite. When accessing this option, you will continue to receive your normal allowances and the respite carer will also receive the same amount.
  
  
• Option 2: Respite Fund Payment (Lump sum)
  
  Should you not wish to take your respite provision, you will be entitled to a cash sum the equivalent to the costs of providing such respite. You may submit a Respite Funds Request Form and by doing so you may access a lump sum payment based on the number of annual respite days that have accrued at the point you submit the claim.
  
  You may make a claim for the accrued monies up to twice a year. If you do not utilise the allowance and the child moves on, the money will remain in your respite pot and can still be claimed.

Car Mileage

For information, 200 miles of weekly transportation of the child is included and expected within the fee the local authorities pay for each child. If more than one child is placed this is extended by a further 200 miles for each child i.e. the local authority will expect 600 miles has been prepaid for a group of 3 siblings.

If your weekly mileage is below these figures, then mileage will have been deemed to have been included. There is no expectation on you to reimburse any amount of this total even when you do not undertake mileage under this total.

Additional mileage (above 200 per week) will be reclaimable from the local authority via Children Always First. You will need to submit an Additional Payments form for this to be claimed.

All of your travel mileage to carer support groups and training events is reclaimable at 30p per mile.

Additional Payments forms are obtainable from your Supervising Social Worker or our Administrator and need to be submitted by the 10th of any month in which you wish them to paid.

4. Child Allowances

As a foster carer you are paid an overall child allowance that should be used to care for the child and pay for certain things that they are entitled too.

The breakdown of this allowance in practice differs according to the specific needs of the individual child / young person. However, guidance is issued to ensure that the child / young person’s funding is being used appropriately. The recommended guidance for Children Always First states that this child allowance would normally be split approximately:

For full details of how this is broken down, please see Child Allowance Breakdown in the Useful Resources area

There are three allowances that are set by the Local Authority responsible for the child that is living with you: Pocket Money, Savings and Birthday/Festivals. These allowances come out of the overall Child Allowance:

Pocket Money – Each child is entitled to pocket money each week and this should be discussed and agreed at the placement planning meeting. The pocket money amount will increase with age and your Supervising Social Worker can provide guidance on this or you can refer to the Child Allowance Requirement grid in the Useful resources area

Savings – Each child should have savings put aside by you each week to the minimum value of £10.00. Ideally, you should set up a child’s savings account for it to be paid into and you will be asked to show the savings to your supervising social worker on a regular basis. If a child moves on from your home, the Local Authority Social Worker will need details of this savings account or to be provided with the total savings amount.

Birthday/Festivals - Each child is entitled to gifts and festival celebrations. The Local Authority specify a minimum amount to be spent on all children and this will increase with age. Your Supervising Social Worker can provide guidance on this or you can refer to the Child Allowance Requirement grid in the Useful resources area.

5. Equipment

Discuss with your Supervising Social Worker, any needs for specialist equipment.

6. Initial Clothing Allowance

If a child is placed in an emergency with insufficient clothing and with the written agreement of the child’s social worker, foster carers will be reimbursed for initial clothing required up to £150.  This cannot be accessed unless confirmed in writing by the placing authority. If a carer arbitrarily purchases clothing without express written permission then the agency will not be held accountable for these expenses.

Reasonable costs of school clothing will be paid/reimbursed to the foster carer where this is needed due to unplanned change of school and when agreed in writing by the child’s social worker.

7. Disability Living Allowance (DLA) and Personal Independence Payments (PIP)

When you are in receipt of DLA/PIP for a foster child in your care, any monies received for the child’s care via a DLA/PIP application, must be spent in consultation with the child’s social worker and your Supervising Social Worker.

You should retain all receipts for money spent and complete a monthly tracker to account for the money spent. Any excess monies must remain in a specific account that has been opened for these payments to be made into. For full details on managing PIP and DLA monies please see: Tracking expenditure relating to Disability Living Allowance or Personal Independence Payments to Children and Young People.

8. Passports and Documents

The cost of obtaining birth certificates (and copies), passports and Life Story books will be met by the Local Authority.

Information is also available from the GOV.UK website about passports.

9. Income Tax

When you are fostering, you will need to be registered as self-employed and file tax returns. See File Your Self Assessment Tax Return Online.

You will be entitled to qualifying care relief which means that you will be entitled to:

Tax exemption

In a tax year, households do not pay tax on a fixed amount of the money they earn from fostering. You will still pay tax on money you earn from a job or investment.

Tax relief

On top of the exemption, you also get tax relief for every week (or part week) that a child is in your care.

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

For further information and current figures please see: Foster Carers Relief Information (HMRC) and Help and Support for Foster Parents in England.

10. Claiming Benefits While Fostering

See relevant information on the GOV.UK website.

11. Pensions

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

12. Receipts

You should keep a record of how the allowance is being spent on a child/young person. The child/young person should sign for money they are given e.g. pocket money and clothing allowance or you can encourage independence by setting up a bank account and pay directly into this for children and young people to access. This helps build a record of what has been spent, which you can show if asked for at a later date.

13. 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 care for. 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.