Can I claim universal credit?

Updated on 5 April 2023

Foster care and shared lives care

Here we provide some information about universal credit for foster carers and shared lives carers.

Illustration of people standing in the shape of a question mark

Can I claim universal credit as a foster carer?

Universal credit (UC) was introduced in 2013 and is gradually replacing six existing working-age means tested benefits and payments which are often referred to as the ‘legacy benefits’. These are income support; income-based jobseekers’ allowance; income-related employment and support allowance; housing benefit; working tax credit and child tax credit. Now that UC is available across the UK, HMRC state that most people can no longer make a brand new claim to any of these legacy benefits and are expected to claim UC, or pension credit depending on age, instead.

You can claim UC whether you are in or out of work, and whether or not you are responsible for a child or young person.

How will universal credit affect my tax credits?

You cannot claim tax credits and universal credit at the same time. If you make a claim for universal credit, your tax credits will end. You should get advice before making a UC claim if you are already entitled to tax credits or any of the other legacy benefits UC is replacing.

HMRC and DWP expect most tax credit claimants to have moved over to UC (or to pension credit) by the end of 2024. In the meantime, tax credit claimants can move to UC if they choose to do so, need to claim another benefit which UC has replaced (such as housing benefit) or have a change in circumstances that ends their tax credit award and they cannot make a new claim for tax credits but need to continue claiming support. It is important to get advice before claiming UC if you are already claiming tax credits. 

Am I treated as self-employed for universal credit?

Under tax credits foster carers are treated as self-employed, but under UC they are not – see GOV.UK for confirmation of this.

One of the features of UC is that claimants have to agree to a claimant commitment, whereby they agree any work requirements with their UC work coach. Foster carers claiming UC will be expected to agree work requirements in a similar way, although their caring duties will be taken into account in determining the extent of those requirements and will vary accordingly.

How is my income from foster caring treated for universal credit?

Any allowances and fees received by foster carers are fully disregarded when calculating UC.

We understand that DWP have not yet published any specific information about how claims for UC from shared-lives carers will be handled.

Tax guides

Share this page