Self employment - fostering

14/05/2019 06:37:56

I would like to ask you about advice and information. We are a foster carer more than 3 years. Unfortunately up to day we have no self employment.
We did not get any information that we have to register self employment. Our Social Worker did not inform us when we begined fostering. When we started 1st placement in January 2016 we called to HMRC (because we had Working Tax Credit and we needed information about affect for that benefit) and your colleague asked us only about how much we have weekly our part of money. Office Worker informed us if will be less than 200 pounds per week will be ok and no affect for tax credit . No information about self employment ect.
But 2 days ago I found your HMRC Course - Start Your Own Business and I found information that we have to register self employment. We really did not know that, we really scared about penalty and affect for Child tax for our own children.
Ok it's very late but we want to fix that problem immediately, we don't want to hide anything. Of course I understand we have to open self employment but what about about previous years? How can we fix these problems?
I'm sorry for a mistakes, English is my second language.

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Re:Self employment - fostering

14/05/2019 09:18:42

Thanks for your question.

As a foster carer you have to register as self-employed and complete SA Returns. However, a foster carer can make a claim to Qualifying Care Relief.

The qualifying care relief consists of two parts which you would add together. You will have an annual fixed amount of £10,000 for each household plus a weekly amount of £200 for children under 11, £250 for children aged 11 or over and also for adults.

You will need to calculate the qualifying care relief for each year and if your total income received is less than the qualifying amount then you will be exempt from tax.

If this is the case and you are exempt you still have to complete Self Assessment Returns. You will need to register as self-employed and for Self Assessment and then look at the years 2015/16 to 2018/19 to see if you qualify for the relief.

As we do not have access to your records I would advise you to contact HMRC direct with your calculations to see if we require the returns for 2015/16 to 2017/18, however, you will need to complete a Self Assessment Return for the year 2018/19.

Please refer to the following links that will assist you further:

Set up as self-employed (a 'sole trader'): step by step

Register for and file your Self Assessment tax return

Qualifying care relief for carers: HS236 Self Assessment helpsheet

Contact HMRC

I hope this helps.