The measure

Certain payments made to qualifying carers (see below) who effectively take on legal parental responsibility will be exempt from income tax.

The qualifying payments for the income tax relief are:

• Those made by the child's parents or by, or on behalf of, the local authority;
• To a qualifying carer.
   

Who will be affected?

Individuals who care for one of more children placed with them under:

• a special guardianship order; or
• a residence order, where the individual is not the children's parent or step-parent.
  

When?

The measure will take effect for payments received from 6 April 2010.