Is there a cap on the amount you pay into an IVA ?

[pseaman66]

My wife has just passed an exam and as a result her job title may be changing which could mean a heft pay rise (app £9,000 per annum) We are currently paying £817 per month into our IVA and we are in our second year.

If she gets this payrise are our payments going to ris to above £1,000 per month or is there a cap on the amount you pay for an iva.

I am sure it is just dependent on what you earn but my wife started her studying before we went into the iva and after 2 years of studyibg it seems a shame for all the money to go.

[Foggy]

Hi. Congratulations on the pay rise

Ther is, I am afraid, no cap you can call on here to limit payments. Hopefully, under the terms of your proposal, as is usual, you will at least be able to retain 50% of the rise.

Now, although they shouldn't, IP's vary on the timing of the rise. Mine (GT) tell me that any pay rise during the year is mine to keep in total, until the next annual review, when the increase will take effect. Others seem to take the rise immediately (and incorrectly, in my opinion, if you have a protocol compliant proposal).

[pseaman66]

Hi Foggy,

Thanks for the quick response,

I think there is the 50% clause in the IVA so as you say we should be able to keep half.

Once the salary increase is confirmed I will contact my IP and see what they do, hopefully it will wait until tne next review in June. Fingers crossed.

[sponge]

Does the employer run a pension scheme or health care or similar sacrifical benifts

[pseaman66]

Hi Sponge,

She works for the local council so I am sure that there is a pension scheme.

Why do you ask?

[MelanieGiles]

Well done to her for a great achievement. You will hopefully be able to retain 50% of the increased salary, and you should advise your IP of this as soon as she knows it is going to start to be paid. They may increase your payments at that point, given that the increase is material. There is no upper cap on IVA payments. I once had a client who was paying £20,000 per month.

[Shining]

congratulations to your wife on achieving her qualification. Just think when the IVA has finished it will be all disposable income - a nice payrise. x

[pseaman66]

Thanks for all the answers and that's what we are holding out for but the end seems a long way off as we are only into the 2nd year.

[luluj]

It won't be long before you are in your final year...time goes quickly !

The increased salary will allow for a higher return to creditors ...if this means you will be able to pay 100% of your original debt plus IP fees then your IVA may end earlier than the fifth year..... Inform your IP as soon as the increase happens as it is a significant amount the likelihood is that they may not want to wait until your annal review is due. From experience ensure your 50% retention is adhered to and they don't try to take more. Good luck.