Qualifying care relief for shared lives carers

Shared lives care

Shared lives care is where an adult either lives with or regularly visits a shared lives carer in the home of that carer and shares in the family and community life of that carer. Shared lives carers have people matched with them by shared lives schemes or local authorities. These social care schemes are regulated and they approve and train the shared lives carers. Shared lives care can include respite care in certain circumstances. Respite carers should ask their scheme for guidance on this matter.

Qualifying care for qualifying care relief

Historically payments to shared lives carers came from one source only, but due to changes such as in funding for social welfare, payments may now be made to the carer from more than one place. The source of the payments is important because that can determine whether the payments to the carer are for qualifying care for these purposes and so whether the payments that the carer receives are able to be covered by qualifying care relief. 

If the payments are not for qualifying care, the carer would not be entitled to qualifying care relief and so must declare the payments received for providing care minus expenses wholly and exclusively incurred in looking after the service user to arrive at the taxable self-employed profit. See our page Calculating self-employed profits for detailed guidance on how to work out taxable profits. The carer must also check whether they are in scope of Making Tax Digital for income tax, which affects some self-employed people.

In order to fall within the remit of qualifying care, payments to carers can be funded by the NHS, local authorities or by the supported adult, but crucially any payments for care must not be paid directly from the supported adult to their carer. Such payments must be paid direct from the scheme or scheme administrator. Payments for accommodation or food could still be made direct to the carer from the adult, though. 

If any payments for care are made direct to the carer by the supported adult, then none of the payments received by the carer for that adult would be within the meaning of qualifying care.

The scheme determines the overall payment to be made to the carer that will include elements for accommodation, food and care, for example. How that overall payment reaches the carer will depend both on how the scheme is organised and the financial circumstances of the supported adult. 

If the carer receives direct payments from the supported adult that are not related to the social care scheme, for example they are for hairdressing, then those payments would not be eligible for qualifying care relief in any case.

While this is complex, your scheme should be able to tell you whether or not the payments you have received will fall within the definition of qualifying care.

More information

You can obtain more help and guidance from Shared Lives Plus.