Fostering is an incredibly rewarding way to make a difference in a child’s life. But if you’re considering becoming a foster parent, you may be wondering about the practical side of things, particularly employment status and finances.
One common question is: Are foster carers self-employed? The answer is yes, foster parents in the UK are generally considered self-employed but this status comes with specific considerations regarding tax, allowances and benefits.
Let’s explore what this means for you, the responsibilities involved and the support available to foster parents.
Foster carers – or foster parents as we prefer to call our community at Mosaic – provide a safe, nurturing home for children who cannot live with their birth families. This can be on a short-term or long-term basis, depending on the needs of the child and the care plan decided by the local authority.
At Mosaic Foster Care, we specialise in long-term, therapeutic placements, supporting children through to adulthood.
Foster parents play a vital role in providing stability, security and care, often helping children recover from trauma and build a brighter future.
In the UK, foster carers are classified as self-employed. This means that while you are registered with a fostering agency like Mosaic, you are not an employee. Instead, you are considered an independent provider of care services.
Being self-employed allows foster parents to receive specific financial benefits and tax relief that are tailored to the unique nature of fostering. However, this also means that you are responsible for managing your own tax affairs and National Insurance Contributions (NICs).
Foster parents receive a fostering allowance to cover the costs of caring for a child. This allowance helps with expenses such as food, clothing, school supplies, and activities. Additionally, foster carers may receive fees or payments in recognition of their skills and experience.
At Mosaic, we offer generous allowances to ensure you can provide the best care possible for your foster child. The exact amount will depend on factors such as the child’s needs, the type of fostering placement and your level of experience.
As a self-employed foster carer, you need to be aware of specific legal considerations, including:
Mosaic Foster Care ensures you are fully informed of these legal obligations and provides ongoing guidance and support to help you meet them confidently.
Foster carers must register as self-employed with HMRC (Her Majesty’s Revenue and Customs) and complete an annual Self-Assessment Tax Return. However, fostering comes with generous tax relief to reflect the unique nature of the role.
This tax relief means that much of your fostering income may not be taxable. Under QCR, foster carers can earn up to a certain threshold before needing to pay tax. The relief covers:
As a self-employed foster carer, you’ll need to pay Class 2 NICs if your annual profits exceed the threshold. If you earn above a higher threshold, you may also need to pay Class 4 NICs.
You can find more information on fostering tax relief on the official government site:
www.gov.uk/becoming-foster-parent/help-with-the-cost-of-fostering
At Mosaic, we understand that managing the financial and legal aspects of fostering can feel overwhelming. That’s why we offer comprehensive support, including:
For more information, visit:
www.mosaicfostercare.com/faqs/training-support/
Although foster carers are classified as self-employed, fostering is different from typical self-employment:
| Foster Care | Traditional Self-Employment |
| Tax relief via Qualifying Care Relief | Taxed on all profits minus allowable expenses |
| Regular allowances for each child | Invoices for products/services provided |
| Ongoing support and training | Independent business operations |
| Emotional and social responsibilities | Business and client responsibilities |
Foster carers have a unique set of responsibilities, including:
Mosaic provides training, supervision and ongoing support to help you meet these responsibilities effectively.
No formal qualifications are needed to become a foster carer. However, training is essential. At Mosaic, we offer:
Fostering can provide a reliable source of income while allowing you to make a positive impact. However, it’s important to:
Mosaic’s team offers advice to help you manage your finances effectively.
At Mosaic Foster Care, we’re here to support you on your fostering journey — from training and finances to emotional support.
Speak to a Mosaic foster parent today and find out how you can provide a loving, stable home for a child in need.
