Foster Carer Tax Return Example: How to Complete Your Self Assessment?
• July 15, 2026
A foster carer normally completes a Self Assessment tax return by adding up their total fostering payments, calculating their Qualifying Care Relief amount and comparing the two figures.
The Qualifying Care Relief calculation includes:
- A fixed household amount
- A weekly amount for each child or adult in placement
- An adjustment when the carer was approved for only part of the tax year
When total qualifying care receipts are below the qualifying amount, HMRC normally treats the foster carer as having made neither a taxable profit nor a loss from their care income. The carer should still complete the relevant Self Assessment pages and claim the relief.
When receipts exceed the qualifying amount, the carer can normally use either the simplified method or the profit method to calculate taxable fostering profit.
Key Takeaways:
- Foster carers are generally treated as self-employed for tax purposes and should register for Self Assessment.
- The 2025–26 fixed household amount is £19,690.
- The weekly relief is £415 for a child under 11 and £495 for a child aged 11 or over.
- The fixed amount applies per household, not separately to every foster carer living there.
- A part-week placement counts as a full week.
- When fostering receipts are below the qualifying amount, the taxable fostering profit is normally zero.
- When receipts exceed the qualifying amount, only the excess is treated as profit under the simplified method.
- The online filing and payment deadline for the 2025–26 return is 31 January 2027.
What Is a Foster Carer Tax Return?
A foster carer tax return is a Self Assessment return used to report fostering income, claim Qualifying Care Relief and declare other taxable income.
Are Foster Carers Classed as Self-employed?
UK foster carers should generally register as self-employed when they begin fostering. They are normally required to file tax returns even when Qualifying Care Relief means that no Income Tax is payable on their fostering payments.
What is Qualifying Care Relief?
Qualifying Care Relief is a special tax calculation for approved carers. It allows qualifying fostering payments up to a calculated threshold to be received without Income Tax or Class 4 National Insurance becoming due on that care income.
The relief is separate from the Personal Allowance. Employment income, pension income, savings and other taxable income remain subject to the normal tax rules.
Which Care Arrangements Can Qualify?
The relief can cover approved foster care and certain other arrangements where a person is placed by a local authority, fostering service provider or eligible care provider.
It can also apply to qualifying kinship care, Staying Put arrangements and some supported-lodging arrangements. Private informal arrangements with friends or relatives do not automatically qualify.
Do Foster Carers Have to Complete a Self Assessment Tax Return?
A foster carer should generally register for Self Assessment and submit a return after becoming an approved carer.
When Does a Foster Carer Need to Register?
A new foster carer who needs to submit a return for 2025–26 should normally tell HMRC by 5 October 2026. Registration gives the carer a Unique Taxpayer Reference, commonly known as a UTR.
A carer who is already registered as self-employed does not normally need a second UTR, but their fostering activity must still be included correctly.
Is a Tax Return Required When No Tax is Due?
Yes, a return may still be required. Filing a tax return and paying tax are separate matters.
A foster carer whose receipts are below the qualifying amount will normally report zero taxable fostering profit, but they should still claim Qualifying Care Relief on the relevant self-employment pages.
What Other Income Must Be Declared?
The return may also need to include income from:
- Employment
- Pensions
- Savings and investments
- Rental property
- Another self-employed business
- Overseas income
- Capital gains
Qualifying Care Relief applies to eligible care income. It does not make unrelated income tax-free.
What Is the Foster Carer Tax Allowance for 2025–26?
The following figures apply to the tax year from 6 April 2025 to 5 April 2026.
| Qualifying Care Relief element | 2025–26 amount |
|---|---|
| Fixed amount for a household approved for the full year | £19,690 |
| Weekly amount for each child under 11 | £415 |
| Weekly amount for each child aged 11 or over | £495 |
| Weekly amount for each qualifying adult | £495 |
The qualifying amount is the fixed household amount plus the relevant weekly amounts for each qualifying placement.
Why Must the Correct Tax Year Be Used?
Qualifying Care Relief rates are updated periodically. A foster carer tax return example using an older fixed amount or weekly rate could produce an incorrect taxable profit.
The rates increased again for 2026–27 to £20,440 for the household amount, £435 for a child under 11 and £515 for a child aged 11 or over. Those newer figures must not be used when completing the 2025–26 return.
Is the Fixed Amount Per Person or Per Household?
The £19,690 fixed amount applies to the household.
When two qualifying carers operate from the same household, the fixed amount is divided by the number of carers. For example, two carers would generally receive a fixed amount share of £9,845 each before adding their relevant weekly amounts.
How Is Qualifying Care Relief Calculated?
The basic calculation is:
Qualifying amount = fixed household amount + qualifying weekly amounts
The carer then compares that result with their total qualifying care receipts.
Step 1 – Calculate the fixed household amount
A foster carer approved for the whole of 2025–26 uses the full £19,690 household amount.
When the carer was approved for only part of the year, the amount is apportioned:
Number of approved days × £19,690 ÷ 365
Step 2 – Count the Placement Weeks
Each placement should be recorded separately. For Qualifying Care Relief, a week starts on Monday and ends on Sunday.
A part-week counts as a full week. A placement starting on Wednesday and ending the following Tuesday therefore falls into two qualifying weeks.
Step 3 – Apply the Correct Weekly Rate
For 2025–26, the carer uses:
- £415 for each qualifying week involving a child under 11
- £495 for each qualifying week involving a child aged 11 or over
- £495 for each qualifying week involving an adult
Step 4 – Compare Receipts With the Qualifying Amount
When total receipts are equal to or below the qualifying amount, the taxable profit is normally zero.
When total receipts are higher, the excess can be treated as taxable fostering profit under the simplified method.
Foster Carer Tax Return Example for 2025–26
The following foster carer tax return example shows how the simplified method works.
The fictional foster carer:
- Was approved for the full tax year
- Received £55,000 in fostering payments
- Cared for one child under 11 for 24 weeks
- Cared for one child aged 11 or over for 40 weeks
Step 1 — Record Total Fostering Receipts
Total qualifying care receipts: £55,000
This should include qualifying fees, salaries, reward payments and allowances received from the fostering provider.
Step 2 — Add the Fixed Household Amount
Fixed household amount: £19,690
The example assumes there is one qualifying carer in the household.
Step 3 — Calculate Relief for the Younger Child
24 weeks × £415 = £9,960
Step 4 —Calculate Relief for the Older Child
40 weeks × £495 = £19,800
Step 5 — Calculate the Total Qualifying Amount
| Calculation element | Amount |
|---|---|
| Fixed household amount | £19,690 |
| Child under 11: 24 × £415 | £9,960 |
| Child aged 11 or over: 40 × £495 | £19,800 |
| Total qualifying amount | £49,450 |
Step 6 — Calculate Taxable Fostering Profit
£55,000 receipts − £49,450 qualifying amount = £5,550
The foster carer’s simplified-method profit is therefore £5,550.
This does not mean that the final Income Tax bill will be £5,550. It is the fostering profit added to the carer’s other taxable income before allowances, tax bands and individual circumstances are considered.
What Happens When Foster Care Income Is Below the Qualifying Amount?
Consider the same placement pattern but reduce total fostering receipts to £45,000.
| Item | Amount |
|---|---|
| Total fostering receipts | £45,000 |
| Qualifying amount | £49,450 |
| Difference below threshold | £4,450 |
Because the receipts are below the qualifying amount, HMRC normally treats the carer as having made neither a profit nor a loss from the caring activity. No Income Tax or Class 4 National Insurance is normally due on that fostering income.
The unused £4,450 does not create a trading loss and cannot normally be carried forward.
How to Complete the Foster Carer Self Assessment Form?
The precise screen layout may differ depending on whether the return is submitted through HMRC or commercial tax software. The underlying information remains the same.
Which Self Assessment Pages Does a Foster Carer Use?
A foster carer usually completes:
- The main SA100 tax return
- The SA103S self-employment short pages when claiming Qualifying Care Relief
- The HS236 Qualifying Care Relief calculation
A carer using the normal profit method instead of Qualifying Care Relief generally completes the SA103F self-employment full pages and reports actual income and allowable expenditure.
How Should the Business Details Be Completed?
Box 1 — Description of Business
The 2025–26 SA103S notes instruct a foster carer to enter:
Qualifying carer
Box 4 — Foster Carer or Shared Lives Carer
The carer should place an X in box 4.
What is Entered When Receipts Are Below the Qualifying Amount?
When the qualifying amount exceeds total qualifying care receipts, the SA103S notes instruct the foster carer to:
- Enter zero in box 31
- Leave the remaining self-employment short-page boxes blank where instructed
What is Entered When Receipts Exceed the Qualifying Amount?
When receipts exceed the qualifying amount and the carer uses the simplified method:
- Boxes 2 to 8 are completed where applicable.
- Box 9 contains total qualifying care receipts.
- Box 20 contains the qualifying amount.
- Boxes 21, 28 and 31 contain the resulting profit figures where applicable.
In the worked foster carer tax return example, box 9 would show £55,000, box 20 would show £49,450, and the resulting profit would be £5,550.
Does the Online Return Look Different?
Yes. Online Self Assessment software may ask questions in a different order or use plain-language prompts instead of displaying every paper-form box immediately.
The carer should select the option identifying them as a foster carer or qualifying carer and check the calculation before submission.
Simplified Method Versus Profit Method
When fostering receipts exceed the qualifying amount, a foster carer may need to compare two calculation methods.
| Feature | Simplified method | Profit method |
|---|---|---|
| Calculation | Receipts minus qualifying amount | Receipts minus allowable expenses and capital allowances |
| Main form | Usually SA103S | SA103F |
| Record keeping | Simpler | Detailed income and expense records |
| Qualifying Care Relief claimed | Yes | No |
| Separate expenses deducted | No | Yes, where allowable |
| May be suitable when | Relief produces a lower profit | Actual allowable costs exceed the qualifying amount |
The simplified method is often easier because the carer does not need to calculate every household and placement expense separately.
The profit method may produce a better result when actual allowable expenses and capital allowances are greater than the Qualifying Care Relief amount. However, the carer must retain detailed evidence and apply the normal self-employment expense rules.
Can Foster Carers Claim Expenses as Well as Qualifying Care Relief?
A foster carer cannot normally claim Qualifying Care Relief and then deduct the same fostering expenses separately.
Under the simplified method, the qualifying amount replaces the deduction of actual business expenses and capital allowances.
A carer wishing to deduct actual allowable expenditure instead must use the profit method. This decision should be made after comparing both calculations, particularly when fostering receipts significantly exceed the qualifying amount.
How Do Part-Year and Part-Week Placements Affect the Calculation?
Foster Carer Approved for Only Part of the Tax Year
The fixed household amount is reduced according to the number of days for which the person was an approved carer.
For example, a carer approved for 200 days would calculate:
200 × £19,690 ÷ 365 = £10,789.04
The figure should be handled consistently with HMRC’s return instructions and rounding requirements.
Placements Lasting Part of a Week
Each week runs from Monday to Sunday. Any part of a qualifying week counts as a full week.
A child placed from Friday to Tuesday crosses two HMRC weeks and therefore creates two weekly amounts.
A Child Who Turns 11 During the Year
The carer should retain the child’s date of birth and split the placement record so the correct under-11 and 11-or-over rates can be applied.
Where there is uncertainty over the treatment of the birthday week, the carer should confirm the position with HMRC or a qualified tax adviser.
Two Foster Carers in One Household
The fixed household amount is divided between the qualifying carers. They should also ensure that fostering receipts and weekly placement amounts are reported consistently between their returns.
Professional advice may be helpful when payments are made jointly or divided unevenly.
What Records Should a Foster Carer Keep?
A foster carer should retain enough information to support both the receipts and the Qualifying Care Relief calculation.
Useful records include:
- Annual payment statements from the fostering provider
- Bank statements showing fostering payments
- Approval and cessation dates
- Placement start and end dates
- The age or date of birth of each child
- A record of part-weeks
- Copies of the qualifying amount calculation
- Previous tax returns
- HMRC correspondence
- Expense receipts when the profit method is used
Self-employed taxpayers must normally keep their business records for at least five years after the 31 January submission deadline for the relevant return. Records for the 2025–26 return should therefore normally be retained until at least the end of January 2032.
Foster Carer Self Assessment Deadlines for 2025–26
The principal deadlines are:
| Action | Deadline |
|---|---|
| Tell HMRC that a return is required | 5 October 2026 |
| Submit a paper return | 31 October 2026 |
| Submit online when tax is to be collected through PAYE, if eligible | 30 December 2026 |
| Submit an online return | 31 January 2027 |
| Pay tax due | 31 January 2027 |
A foster carer can file the 2025–26 return at any time after 6 April 2026. Filing early can provide more time to check the calculation and budget for any tax due.
Does Making Tax Digital Apply to Foster Carers?
Foster carers receiving Qualifying Care Relief do not need to use Making Tax Digital for Income Tax before April 2027.
Some carers are automatically exempt for 2026–27 because Qualifying Care Relief appeared on their 2024–25 return.
A carer who did not claim it on that return but reasonably expects to claim it for 2025–26 or 2026–27 may need to apply for the temporary exemption.
From 2027–28, Making Tax Digital may apply when relevant qualifying self-employment and property income exceeds £30,000.
Qualifying Care Relief itself does not count towards qualifying income, although another self-employed business or property income may affect the position.
Real-Life Scenario: A Foster Carer With Employment Income
Consider a foster carer who also works three days a week for an employer.
Their fostering receipts are £40,000 and their Qualifying Care Relief amount is £46,000. Their taxable fostering profit is therefore zero.
However, the salary from their employment remains taxable through PAYE and must still be reflected correctly in the Self Assessment return. Qualifying Care Relief does not increase the Personal Allowance or remove tax from employment, investment or rental income.
This separation is important when reviewing a foster carer Self Assessment calculation. A zero fostering profit does not necessarily mean that the person has no overall Self Assessment liability.
Foster Carer Tax Return Checklist
Before submitting the return, the foster carer should confirm that:
- The correct tax year’s rates have been used.
- All fostering payment statements have been collected.
- Approval dates have been checked.
- Every placement and part-week has been recorded.
- Children have been separated by age category.
- The household amount has been divided where there is more than one carer.
- Total receipts have been compared with the qualifying amount.
- The simplified and profit methods have been compared where appropriate.
- “Qualifying carer” has been entered as the business description.
- The foster-carer box has been selected.
- Employment and other taxable income has been included.
- The final calculation has been reviewed before submission.
- Supporting records have been retained.
When Should a Foster Carer Speak to an Accountant?
Professional advice may be worthwhile when:
- Fostering receipts substantially exceed the qualifying amount.
- Two or more carers receive payments in the same household.
- The carer has employment, property or other business income.
- Actual expenses may make the profit method more beneficial.
- A previous tax return contains incorrect relief figures.
- Placements involve complex Staying Put or supported-lodging arrangements.
- HMRC has opened an enquiry.
- The carer is unsure whether Making Tax Digital applies.
- A large tax payment or payment on account may become due.
An accountant should be given the annual fostering statement, placement schedule, approval dates and details of all other income.
Conclusion
A clear foster carer tax return example can make the Self Assessment process easier to understand. The calculation begins with total fostering receipts, adds the fixed household and weekly relief amounts, and then identifies whether any taxable fostering profit remains.
For 2025–26, the key figures are £19,690 per household, £415 per week for each child under 11 and £495 per week for each child aged 11 or over.
Foster carers should use figures for the correct tax year, include other taxable income separately and follow the current HMRC instructions for the SA103S or SA103F pages.
Where arrangements or income sources are complex, professional tax advice can reduce the risk of an incorrect return.
Frequently Asked Questions
Does every UK foster carer have to register as self-employed?
Approved foster carers should generally register as self-employed and complete Self Assessment returns. A person who is already registered should ensure that their fostering activity is reported correctly rather than applying for another UTR.
Can a foster carer submit a tax return when no tax is payable?
Yes. A tax return may still be required even when Qualifying Care Relief reduces taxable fostering profit to zero. The carer uses the return to report the activity and claim the relief.
Is fostering allowance counted as taxable income?
Fostering payments are included as qualifying care receipts, but Qualifying Care Relief may cover all or part of them. Only the excess above the qualifying amount is treated as profit under the simplified method.
Can two foster carers each claim the full household amount?
No. The fixed amount applies per household. When two qualifying carers operate in the same household, the amount is divided between them.
What happens when a foster child turns 11 during the tax year?
The placement record should be divided so the appropriate age-related weekly rates can be used. The carer should retain the child’s date of birth and confirm the treatment of the birthday week if it is unclear.
Can emergency and respite placements qualify for weekly relief?
A qualifying placement can generate weekly relief even when it lasts for only part of a week. It must be an eligible care arrangement rather than an informal private arrangement.
Can foster carers claim mileage and household costs?
Actual allowable costs may be deducted when the carer uses the normal profit method. They cannot normally be claimed separately when the carer uses Qualifying Care Relief and the simplified method.
Which Self Assessment form should a foster carer complete?
A carer claiming Qualifying Care Relief generally uses the SA103S self-employment short pages. A carer using the normal profit method generally uses the SA103F full pages.
Does Qualifying Care Relief cover private fostering arrangements?
Private arrangements with friends or relatives do not automatically qualify. Eligibility normally depends on an approved placement through a local authority, fostering service or another qualifying provider.
Can an incorrect foster carer tax return be amended?
A submitted Self Assessment return can normally be amended within HMRC’s permitted amendment period. The carer should correct the figures promptly and obtain advice where the change affects tax, National Insurance or payments on account.
Tax year covered: 6 April 2025 to 5 April 2026
Editorial note: The rates and filing instructions in this guide have been checked against HMRC guidance available in July 2026.
Important: This article provides general information and an illustrative foster carer tax return example. It does not replace personalised advice from HMRC, a qualified accountant or a tax adviser.
Source Links
- HMRC: HS236 Qualifying Care Relief guidance
https://www.gov.uk/government/publications/qualifying-care-relief-foster-carers-adult-placement-carers-kinship-carers-and-staying-put-carers-hs236-self-assessment-helpsheet/hs236-qualifying-care-relief-foster-carers-adult-placement-carers-kinship-carers-and-staying-put-carers-2026 - HMRC: Self-employment short pages (SA103S)
https://www.gov.uk/government/publications/self-assessment-self-employment-short-sa103s - HMRC: Self-employment full pages (SA103F)
https://www.gov.uk/government/publications/self-assessment-self-employment-full-sa103f - GOV.UK: Tax arrangements for foster parents
https://www.gov.uk/support-for-foster-parents/tax-arrangements - GOV.UK: Self Assessment deadlines
https://www.gov.uk/self-assessment-tax-returns/deadlines - HMRC: Making Tax Digital exemptions
https://www.gov.uk/guidance/find-out-if-you-can-get-an-exemption-from-making-tax-digital-for-income-tax - GOV.UK: Self-employed record-keeping rules
https://www.gov.uk/self-employed-records/how-long-to-keep-your-records - Compass Fostering: Foster carer tax benefits
https://www.compassfostering.com/faq/foster-carer-tax-benefits/
