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Is there a 'loophole' re. foster carers and tax credits?
Generally, I think the Tax Credits intention was that a fosterer cannot be treated as responsible for a child they are fostering if they are getting financial help (fostering allowance) from the Local Authority. And so cannot include that child in their claim for Tax Credits.
But I think the legislation says something different:
It is at: Case B, rule 4 Reg 3 Child Tax Credit regs 2002 (SI 2002/2007) .
It says that you are not classed as responsible for a child if:
(i) The child is being looked after by a local authority,
(ii) has been placed for adoption by that authority in the home of a person proposing to adopt him,
and the LA is making payments for the child's accomodation or maintenace
BUT there are lots of foster placements where the child is NOT placed with them in order for the child to be adopted by them! (so (ii) is not satisfied). So, therefore my thinking is they CAN be classed as responsible for that child.
Page 1291 in CPAG handbook, last but one bullet point - reflects what the legislation says. And, the detailed inland revenue guidance also reflects this.
But, the general TC guidance that comes with the claim form, says probably what they intended:
"If you are in the process of adopting a child or are fostering a child, you can get CTC providing the Local Authority is not paying you for the child's accommodation or maintenance."
but it's not what the law says.
I would be very grateful for your views on this
Thanks
Clive
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