LA foster carers & the BENEFIT CAP.

[minximoo]

Iv just been thinking (dangerous i know.. lol)

I understand there needs to be a cap on benefits - but - i see trouble ahead. And im just hoping the government really thinks this through...#

What will happen to LA foster carer wages which are paid as 'allowances' etc. If the government incorporate these figures and add them to other qualifying benefits - many will simply be working for next to nothing. Understandably they may then throw the towel in on LA fostering.

If they leave the LA the SSD will fall back on private fostering agencies.. The cash strapped council will simply dig a deeper hole..
I suppose the option ppl will have is to apply for WTC. Now then, if the SSD dont have a placement for you, you may be lucky to have a retainer for a couple of months. So, technically - will foster carers be self employed ??
If so - then hay-ho we need an accountant and so on.
Given these factors i imagine many would transfer to IFA as it seems to look like less hassle. Iv had my own businesses and i really dont want the hassle of accounts and reciepts. in my eyes, fostering is about 'the love of helping a child' (in general terms) not about balancing the government books and becoming an accountant!
In their eagerness to save money theyr going to trample on the very people that are part of this countrys backbone.

What a mess...

Some good points made!
But as an aside, the carers who are with the IFA I work at are self-employed and do their own tax returns etc and from colleagues in other IFAs I believed this to be the norm.

As far as I'm aware ALL foster carers are classed as self employed and MUST register with the tax man accordingly. There's no difference whether you're with LA or IFA. There's no need for an accountant though and very, very few will have to pay any tax. The return is fairly straightforward, I do mine myself on line. Some foster carers I know no longer have to complete any tax return as they've been fostering for a considerable length of time.

I'd not thought about the allowance affecting my benefits though - although I did have an interview with my benefits advisor this week and she said nothing will change. If only they paid us properly we wouldn't have to claim benefits in the first place - a ridiculous situation considering the money all comes from the government at the end of the day.

I am a LA carer and I am "self employed" and had a tax return ect to file for last year. My understanding like scarlets is we are all self employed and as such need to take care of our accounting.

For what it is worth the tax system (at the minute) is set up that we get relief on all of the allowances and fees so we don't have any tax to pay, and being such a small earner can also choose not to pay NI (of course if you have up to date NI it might be worth it)

Yes you can also claim working tax credit.

Yip I agree. ALL foster carers are self employed and legally should be registered as such. There is a simplified way of calculating tax return and you do not need an accountant.

You should all be claiming credits for your state pension too. Need to complete a form and get a letter from your LA or fostering agency each year stating you were fostering for that time.

A lady i know claims income support, her rent is paid and has all the benefits as if she were purely 'unemployed'. At present she is fostering three children for the council and this money is paid on top of her benefits. There wasn't an error - the job centre sorted it all out ten years ago when she first started and did all her forms as she is very dyslexic. She is a fabulous foster carer, and the children thrive with her - but she has often said that she has to 'spend' money to keep it below the benefits limit to avoid deductions.... (16k i think).

There are ways round the system that we simply dont know about it seems...

Minximoo. That would be correct. Money received from fostering is 'special' in terms of benefits and tax. However you are still legally supposed to be registered as self employed. It's the law and has been for quite a long time I believe.

I agree. it sounds obvious to me that foster carers are self employed. In fact her situation dumbfounded me - i actually advised her to have the job centre check it out again... which she did. And ten years down the line she does not claim working tax credit. Go figure lol x

I think the benefits for fostercarers can work in different ways. She's maybe been advised that the benefits she gets now is more financialy beneficial to her than doping it another way and claiming wtc. Don't think you can do IS and WTC......it's just the combination of benefits.