Kinship Care vs Fostering: Legal, Financial and Support Differences

Families step in for children every day—grandparents, aunts, older siblings, or trusted family friends. Sometimes that care is kinship care; sometimes it’s foster care through the local authority. The terms overlap in everyday speech, but in UK law and practice they’re different—and those differences affect legal status, money, and support. Here’s a clear side-by-side guide so you can see where you stand, what to expect, and how to get help.

1) Legal status: who “holds” responsibility?

Fostering means the child is a looked-after child and the local authority shares parental responsibility (PR), usually under a care order or via voluntary accommodation (s20). Foster carers are approved under fostering regulations and care for the child on behalf of the authority. Day-to-day decisions are delegated, but major decisions sit with the local authority and/or those with PR.

Kinship care is an umbrella term for relatives or friends raising a child. It can take several legal forms:

• Kinship fostering (connected persons fostering): the local authority places the child with a relative/friend as foster carers. Authorities can grant temporary approval while full assessment is completed (often referenced as “Reg 24”), then complete a standard fostering approval if the arrangement continues.
• Special Guardianship Order (SGO): a court order giving the special guardian clear, long-term responsibility. The child is not looked after; the local authority must assess support needs and may provide financial and other help.
• Child Arrangements Order (CAO)/Residence Order: sets where the child lives and with whom. Support is usually more limited than for fostering, though some help may be available after assessment.
• Private fostering: a parent-arranged placement with someone who is not a close relative for 28+ days; the local authority must be notified but does not approve the carer as a foster carer. This is different again from kinship fostering.

Why it matters: if the child is looked after and you are approved (even temporarily) as a foster carer, you’re inside the fostering system with the protections and responsibilities that brings. If you hold an SGO/CAO instead, you take on parental-type responsibility and the local authority’s role changes.

2) Financial support: allowances, fees, and benefits

Foster care (LA or IFA): carers receive a fostering allowance to cover the child’s costs (food, clothing, utilities, transport, activities). Many fostering services also pay a fee/skill payment recognising the carer’s role. Minimum or recommended rates differ by nation and are reviewed annually; agencies may pay above the minimum.

Kinship fostering (connected persons): because this is part of the fostering system, fostering allowances apply while the child is looked after. Payments should broadly mirror those to unrelated foster carers in the same authority, though practice varies and some connected carers report needing to challenge for parity.

Special guardianship/CAO kinship care: there’s no universal national rate. The local authority assesses need and may pay an SGO allowance (often means-tested and reviewed). Amounts and criteria vary by area.

Kinship Allowance Pilot (England, 2025): the government announced a pilot in up to 10 local authorities to pay eligible kinship carers (typically with SGO/CAO) at least the fostering National Minimum Allowance—not means-tested—testing whether stronger financial support stabilises placements and reduces pressure on care. If you’re in a pilot area, ask your council how to apply.

Benefits interactions:

• Kinship foster carers (i.e., looked-after child placed with you) generally cannot claim Child Benefit or the child element of Universal Credit for that child, because public funds are already provided for their maintenance.
• SGO/CAO carers are usually eligible to claim Child Benefit and UC (child element) subject to general rules; any local SGO allowance may be taken into account. Always check with the local authority and a welfare adviser.

Tax relief for foster carers: In England and the rest of the UK, approved foster carers can use Qualifying Care Relief—a generous scheme that often results in no income tax on fostering receipts up to a threshold (fixed annual amount + weekly amount per child). This is specific to fostering/approved adult placements and does not apply to SGO/CAO kinship arrangements. (Check the current HMRC figures for the tax year you’re in.)

3) Assessment, approval and oversight

Fostering approval involves a full assessment (“Form F”), panel recommendation and agency decision. Connected persons can be temporarily approved so a child can move quickly to family, then complete the full assessment within the statutory window. Expect DBS, references, medicals, home checks and safer-caring planning. Reviews take place at least annually.

SGO/CAO routes involve court applications and a local authority report on suitability. The emphasis is on permanence with support tailored to assessed needs rather than ongoing foster-care oversight. The authority where the special guardian lives has duties to assess for support services and may fund therapy, mediation, or financial help, especially in the first three years when the child was previously looked after.

Private fostering does not require foster-care approval, but the local authority must be notified and will assess welfare and safety; they can give advice and support to the carer and parent.

4) Training, supervision and respite

Foster carers (including kinship foster carers) should receive pre-approval training, ongoing supervising social worker (SSW) support, access to out-of-hours help, and a formal training/CPD pathway. National Minimum Standards also cover payments discipline (prompt/clear statements), regular reviews, and consultation on changes. Respite options vary but are normally available within the fostering framework.

SGO/CAO kinship carers do not have an SSW as standard. Support depends on the assessment and local “kinship local offer”. Recent policy shifts expect councils to publish a kinship offer and align practice more closely to ensure kinship families aren’t left without help, but provision still varies widely.

5) Day-to-day decision-making and contact

In fostering, decision-making is guided by the care plan and delegated authority; schools, health providers and birth family contact are coordinated by the social work team. Kinship foster carers operate similarly because the child remains looked after. Special guardians make most decisions themselves (PR rests with them), though there may be contact arrangements ordered by the court and agreed support plans.

6) Choosing the right route for your family

Choose kinship fostering (connected persons) when:

• The child needs an immediate, safe placement with family while long-term plans are assessed.
• You want the ongoing support framework of fostering (SSW, training, respite) while options like SGO are explored.

Move toward SGO/CAO when:

• The plan is for long-term permanence within the family and you’re ready to assume day-to-day parental responsibility with a tailored support package rather than full fostering oversight.
• You’ve discussed financial implications (loss of fostering fees/allowance vs SGO allowance/benefits eligibility).

Check for pilot support: If you’re in England, ask whether your council is part of the Kinship Allowance Pilot that pays SGO/CAO kinship carers at least the fostering National Minimum Allowance; this can be a game-changer for stability.

7) Quick comparison

• Legal status:
  • Fostering/kinship fostering: child is looked after; local authority shares PR.
  • SGO/CAO: child is not looked after; carer holds day-to-day PR (subject to court orders).
• Money:
  • Fostering: allowance (+ possible fee) under fostering framework.
  • SGO/CAO: means-tested SGO/CAO allowance after assessment; pilot in parts of England pays at least fostering NMA.
• Benefits:
  • Kinship foster carers: generally no Child Benefit/UC child element for the placed child.
  • SGO/CAO carers: usually can claim, subject to the standard rules.
• Support:
  • Fostering: SSW, training, reviews, respite; clear standards.
  • SGO/CAO: assessed support; local kinship offer now expected but varies by area.

Final thought

If you’re already caring—or about to—start by pinning down the legal route you’re on. Ask the council to set out, in writing, what support and payments apply now, and what would change if you moved to SGO/CAO. If you’re in England, check whether the Kinship Allowance Pilot is available locally. The right choice is the one that keeps a child safe and secure without leaving your family to shoulder the costs alone.