Chapter TCM0124100
| Published date | 09 April 2016 |
| Record Number | TCM0124100 |
| Court | HM Revenue & Customs |
| Issuer | HM Revenue & Customs |
Treat foster carers and kinship carers as being in remunerative work. The number of working hours declared on the claim form should be accepted.
Normally a fostering arrangement will be with a Local Authority (LA), who may pay an allowance to the carers for the maintenance of the foster child. The allowance may also include things such as any special requirements of the foster child and the cost of wear and tear on the home.
Many foster carers are classed as being self-employed. Foster Care relief provides generous exemption from income tax for fostering income. This will result in many foster carers having ‘nil’ income for tax credits purposes.
Child Tax Credit Claiming for a looked after child or young personIf
- a child or young person has been placed with a foster carer or kinship carer by a Local Authority under part 3 of the Children Act 1989, part 2 of the Children (Scotland) Act 1995 or part 4 of the (Northern Ireland) order 1995
and - the Local Authority is making payments for that child’s or young person’s accommodation and maintenance
then - the foster carer or kinship carer is not classed as being responsible for that child or young person for tax credits. This means that they cannot include the child on their claim.
A customer who is not receiving monetary support for the child may be able to claim tax credits and should include the child on their claim.
Note: From 6 April 2017, customers will only get the Family Element of Child Tax Credit where they are responsible for a child or children born before that date.
Note: The individual child element of Child Tax Credit will no longer be awarded for third and subsequent children or qualifying young persons in a household, born on or after 6 April 2017, unless it meets the exception criteria.
Note: If you are dealing with a claim where an exception marker has been applied to any of the children/young persons included in the claim or the customer is reporting a change relating to an exception contact the Exception Team (This content has been withheld because of exemptions in the Freedom of Information Act 2000) . (This content has been withheld because of exemptions in the Freedom of Information Act 2000) For how to check if the exception marker has been applied, use...
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