BIM52765 - Care providers: qualifying care relief: calculation of qualifying amount
S808-S811, S821 Income Tax (Trading and Other Income) Act 2005
An individual’s qualifying amount for a tax year comprises the following:
- their share of the fixed amount
- weekly amounts for each cared-for child or adult based on the number of weeks during the income period for the tax year
Fixed amount
The fixed amount for each tax year is set out in the table below:
| Tax year(s) | Fixed amount |
|---|---|
| 2002-03 to 2022-23 |
£10,000 |
| 2023-24 |
£18,140 |
| 2024-25 |
£19,360 |
Where a residence is used for the provision of care by more than one individual, each receives an equal share of the fixed amount.
If the income period is not a full year, the fixed amount is adjusted proportionately. For tax years 2023-24 and earlier, the income period is the basis period for the year for trading income or tax year in non-trade cases. For tax year 2024-25 and onwards, the income period is the tax year.
Weekly amount
The weekly amounts for each tax year are set out in the tables below:
| Tax years 2002-03 to 2022-23 | Tax year 2023-24 | Tax year 2024-25 | |
|---|---|---|---|
| Child under 11 years | £200 | £375 | £405 |
| Child 11 years or older | £250 | £450 | £485 |
|
Tax years 2010-11 to 2022-23 |
Tax year 2023-24 |
Tax year 2024-25 |
|
|---|---|---|---|
| Adult | £250 | £450 | £485 |
A week is a period of seven days beginning on a Monday. Periods of care of less than a week are treated as a full week. A week in which an income period ends is treated as belonging to that period.
An individual’s qualifying amount for a period of account is comprised of the following:
- their share of the fixed amount for the tax year in which the period ends (calculated as above),
- for each of the tax years in which the period of account falls, the weekly amounts for each child or adult for the part of the period falling in the tax year.
The legislation provides for the level of the fixed and weekly amounts to be varied.
Foster care of a parent and child
We understand that some local authorities have schemes whereby a child, who is a parent, is placed in foster care. The foster carer effectively cares for the parent and her baby, but only the parent is technically placed in care.
We are informed that the payments made to the foster carer in these circumstances are invariably intended to cover accommodation and care provided to parent and baby. On that basis, we are content for tax purposes to treat the parent and each baby as being in foster care. The foster carer can claim a weekly amount per child for each of them when calculating their qualifying amount.
Specialist foster carers
There are foster carers who care for children with a disability or other special needs (‘specialist foster carers)’. Some specialist foster carers may incur specific expenditure that is clearly not of a type covered by normal maintenance, such as for special equipment. In this case, the amount of actual expenditure can be added to the qualifying amount.
In other cases, the specialist carer's expenses may be exceptional by degree rather than type. In such cases, there is no practicable way of measuring the exceptional expenditure separately. Such carers should record their actual expenses for a set period, and use the resulting data as a basis for calculating the regularly recurring expenses for the full year which can then be added to the qualifying amount.
If the specialist carer receives amounts in excess of the qualifying amount, then it is not necessary to remove any existing special arrangement.