I am currently struggling to meet payments for my credit cards and loans. I am thinking of applying for an IVA but I am a director of 2 small companies. Will an IVA affect my companies or my status as a director? At present neither company is in profitable situation.
An IVA will not affect your position as a director, but the value of your shareholding has to be equated and included as an asset. If the companies are not currently profitable, this may be academic.
Do the companies allow you to take a sufficient drawing to enable an IVA to be presented?
i am a director in name and title, but not a shareholder of my employers comapny. I have reveiwed my contract today and it has a clause in it about termination if " the executive commits any act of bankruptcy or takes advantage of any statute for the time being in force offering relief for insolvent debtors"
It does give them the opportunity to terminate your employment in the event of an IVA, but does not direct you to bring this to their attention. I guess it's one for your conscience at the end of the day, but it might be worth having a confidential chat with your direct boss to see how the land lies.
thanks Melanie, my immediate boss is very aware and more than happy to help in any way he can - im really, really (and another really for good measure) lucky at his approach. He is considering putting up my entire debt as a f&F as he is worried i might be distracted by the iva - I will of course have to pay him back over time, but he sees it as a way of keeping me at work, so he thinks its a win win - I dont know if it will be plausible to present as a F&F yet, but its nice to know I have the support of my boss whatever the outcome
Seems like a good idea - and if there is a F&F to do it would be sensible to make this as part of the IVA offer up front rather than six months after creditors have accepted a contributions based repayment.
What a lovely boss, and I guess you must be a special guy to command that sort of respect. And you know he is right about keeping you focussed on work rather than worrying about an ongoing IVA!
My salary is very small, just under the 603L tax bracket for the year. I am currently looking for a new job and therefore would only be a director on paper of both companies but not drawing a salary/dividend.
As the one company can run with my part time member of staff, I can seek employment elsewhere. I am looking to put the other company dormant.
I am therefore hoping that a new job will increase my income but I am aware that I still may not earn enough to cover all my debts.Would I be better off waiting to see what income I can achieve before progressing further?
You also need to check the company's memorandum and articles.
A director can enter an IVA but if the company has adopted the specimen set of Articles set out in the Companies Act of 1985 without any changes, then Article 81 of Table A provides for the disqualification and removal of directors if they become bankrupt or make any arrangement or composition with creditors generally. It's automatic. If that is the case you can be re-appointed but it is better to pre-empt it and get the rules changed first.
Last edited by ianmillington on Wed Sep 24, 2008 11:18 am, edited 1 time in total.
Ian Millington
Insolvency Director
PDHL Ltd (formerly Personal Debt Helpline Ltd) www.pdhl.co.uk
Thank you for your advice ref IVA. Can you advise me if there is any way I can stop my credit cards adding the interest each month? I am looking to find a new job asap before I look to start an IVA but if I can combat to high interest payment that would really help. Thanks Jane
You could look at doing a Debt Management Plan via the CAB or any one of a number of Debt Management Companies. Or you could simply ask the creditors to give you a bit of breathing space, to give you time to get your act together. In all seriousness, however, neither option will give you a guarantee of an interest freeze.
Ian
Ian Millington
Insolvency Director
PDHL Ltd (formerly Personal Debt Helpline Ltd) www.pdhl.co.uk
