The 17-year-old told her he laughed as the man burned, a jury at Cardiff Crown Court was told on Tuesday.
He and another boy, aged 16, are accused of using a cigarette lighter to turn 67-year-old Billy Williams into a human fireball in Roath, Cardiff.
The two boys - who cannot be named because of their age - both deny causing grievous bodily harm with intent, and inflicting grievous bodily harm.
Mr Williams died three months after the fire, though his death could not be linked to the fire injuries.
The social worker told the jury the boy smiled as he told her: "I took the top off a cigarette lighter and set fire to it with another lighter."
"Kicked"
She said he went on to say : "I threw it over the man. He didn't scream because I had kicked him in the head seven times.
"Then I stood across the street and laughed at him burning."
The social worker added: "He said the man was only a tramp and started laughing.
"I said the man was probably someone's father or grandfather. He just kept smiling."
Samaritans
The boy told the social worker he was with the younger boy - who is 17 next week - when he set fire to Mr Williams.
Another social worker at the home told how the boy telephoned the Samaritans the night after Mr Williams was burned and said he would hang himself.
Earlier in the trial, the court heard that the boys caused the man "excruciating pain" by setting him alight as he slept in the early hours of 17 January.
Mr Williams was taken to the specialist burns unit at Swansea's Morriston Hospital with 27% burns.
Staggering
He underwent three skin graft operations, but died on a life-support machine three months.
Police called to the scene by passers-by saw the man staggering from the lane with smoke pouring from him and his clothes disintegrating.
The elder teenager, now 17, was stopped hours earlier by police, who found two cigarette lighters on him.
He was later seen carrying a jerry can on the handlebars of his bike, it was claimed.
The case continues.