Are fostering payments taxable?

Most fostering payments are not taxable because foster carers in the UK qualify for a special tax scheme called Qualifying Care Relief. This allows you to earn up to a set amount each year from fostering without paying tax, and in many cases it means you will not have to pay tax on your fostering income at all. The exact amount you can earn tax-free depends on the number of children you care for and the length of time they are with you. At Progress, we provide workshops on tax and income to help you understand how this works. In addition, the Fostering Network regularly offers workshops where you can access further advice and guidance to feel confident about your finances.