Benefits

If you are caring for a child who has been placed with you by the council, there are special rules about the treatment of any payments or allowances paid to you to help maintain that child and how they may effect your benefit.

If the council has placed a child with you under certain legal provisions, you may receive one of the following allowances:

• Fostering Allowance
• Adoption Allowance
• Residence or Special Guardianship Order Allowance.

Depending on which one you receive, different rules apply as to whether the child is included in your household for benefits purposes and whether these allowances are taken into account as income for means-tested benefits.

Fostering Allowance

If a child is placed or boarded out with you and you receive a fostering allowance, that child is not counted as part of your family and you cannot have an allowance for that child included in your claim for:

• Income Support,
• Jobseekers Allowance (income-based),
• Housing Benefit,
• Council Tax Benefit,
• Child Benefit,
• Child Tax Credit,
• Pension Credit.

However, if you get one of these benefits already, the amount of Fostering Allowance you receive is ignored altogether as income.

Benefits you can claim for the child are:

• Disability Living Allowance (DLA)
  
  DLA continues for a child who is placed in foster care but
  
  
  • the social worker and DLA unit decide to whom this is paid - this could be the parent, foster parent or another appointed person;
  • if the child was not intended to be in care for more than 12 weeks, the original appointeeship will not be ended until eight weeks has passed.
• Carer's Allowance
  
  Foster carers can claim Carers Allowance as long as:
  
  
  • any reward element included in the Fostering Allowance does not exceed that current year’s lower earnings limit;
  • the cared-for person or child is getting Disability Living Allowance at the middle or high-rate care component.
• Working Tax Credit
  
  Payable to all low-paid workers, including foster carers, it:
  
  
  • tops up part or full-time earnings;
  • is administered by HM Revenue and Customs;
  • takes both partners' incomes into account;
  • ignores Fostering Allowance from the council as income as long as it does not count as taxable profits.

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Adoption Allowance

Continuing financial support for adopted children is disregarded in full for Income Support and income-based Jobseekers Allowance, unless your benefit still includes amounts for children included in your claim since before 6 April 2004 and for whom you do not yet have a claim for Child Tax Credit.

It is taken into account for Housing Benefit and Council Tax Benefit.

For claims before 2004 and for Housing Benefit and Council Tax Benefit, Adoption Allowance counts in full up to the amount of the adopted child’s personal allowance and, if any, disabled child premium. Anything above that is ignored.

Child Benefit and Child Tax Credits may be payable as long as payments of Adoption Allowance do not include monies paid under Section 23 of the Children Act 1989 towards the maintenance and accommodation costs.

Carer's Allowance, Disability Living Allowance and Working Tax Credit can still be claimed.

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Residence or Special Guardianship Order Allowance

This is treated in the same way as the Adoption Allowance. If the council makes a lump sum payment towards adaptations to your home for a disabled child, this is treated as capital and ignored.

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