Business Debtline can refer you to an insolvency practitioner (IP) from our special panel. After reading this fact sheet, if you think that an IVA is the best option for you, see the later section Finding an insolvency practitioner.
Do I have to use an insolvency practitioner recommended by Business Debtline?
You do not have to use one of the IPs that we work with. If you prefer, we can give you advice on how to find one yourself.
Is an IVA suitable for me?
Extra advice:
benefit-only income
If your only income is state benefits, think very carefully about the options to deal with your debts. An IVA may not be a suitable option. Contact us for advice.
An IVA may be a suitable option for you if you have:
- money available every month to pay towards your debts;
- a lump sum or assets that could be included; or
- a combination of spare money each month and assets or a lump sum.
Information:
self-help pack
We have a self-help pack which explains how to complete a business and household budget sheet to work out how much spare income you may have to pay into an IVA.
Contact us for a copy on 0800 197 6026 or see www.businessdebtline.org.
For an IVA to be a realistic option, you would normally need to have:
- at least three debts totalling £7,000 or more;
- two or more different creditors;
- at least £50 per month spare income after your essential bills; and
- be able to pay back at least 1p for every £1 of your debt.
These criteria are a guide only. You may still be able to consider an IVA even if your circumstances fall outside of these guidelines. Contact us for advice.
We may be able to help you set up an IVA, using an insolvency practitioner from our panel. See the later section Finding an insolvency practitioner.
If you and your domestic partner meet these criteria by taking into account your joint circumstances, you may be able to do an IVA together. This is sometimes known as an ‘interlocking IVA’. Contact us for advice.
Is an IVA suitable if I am a member of a partnership?
If you are a partner in a partnership an IVA may be an option for you, but it must take into account your personal liability for debts that the partnership owes. These creditors could still take action against the partnership itself, or against other partners.
If you and your business partner(s) have personal debts as well as debts owed by the partnership, you could propose an arrangement to deal with all of these at the same time. This type of arrangement is more complicated. Contact us for advice.
What debts can be included in an IVA?
Extra advice:
hire purchase and lease agreements
Be careful if you have a hire purchase or lease agreement you want to include in your IVA. Check your agreement carefully to see if there is a clause which allows the creditor to end the agreement if you enter into an IVA, and contact us for advice.
You can include most types of debt in your IVA proposal, but bear in mind that your creditors may object. See the next section IVA procedure. You can include priority debts such as business rates arrears, tax debts, fuel debts and so on. However, you cannot include:
- maintenance, or arrears of maintenance, ordered by a court;
- Child Support Agency or Child Maintenance Service arrears;
- magistrates’ court fines;
- mortgage, secured loan or rent arrears unless your lender or landlord agrees (which is unlikely);
- student loans (for IVAs made on or after 6 April 2010); and
- Social Fund loans.
Warning:
giving incomplete information
If you do not give complete information to your IP about your assets and debts you could be committing a criminal offence.
If you are unsure what debts you can include in your IVA, contact us for advice.