I’ve just got married and know I have to declare this to the supervisor of my IVA, I also know I have to do a new income and expenditure form as I am going from a single person to a couple living together. At present I earn £1500 a month after tax, I currently pay £220 towards my IVA.
My Wife earns £2000 a month after tax, she has nothing to do with the IVA as I had it before I met her. How is the income and expenditure form worked out ? Are things like the bills split 50/50 As she pays the mortgage(Owns her own flat) do I pay 50% of this ?
My current budget I pay £300 a month in petrol, under the petrol allowance do I also include her’s ?
The way I see it is my income will obviously stay the same but my expenditure will fall as the cost of the bills are being split, so say I have £375 left over on my IVA should this now be my new figure as my Wife is now paying some of the costs of living expenses. As she is earning a lot more than me I think will will be ok, slightly confused on this !
Also she is slightly worried about me telling the IVA supervisor she owns her own flat, Do I have to tell them ? after all this is her property and has nothing to do with me or anyone in the IVA.
Items of joint household expenditure are generally allocated in the same ratios as your individual earnings, once you begin living as couple. So if your only income is your respective salaries, then you earn 43% of the total income and your wife the remaining 57% - and so expenditure ought to be allocated on that same ratio basis. You should both independently fund your respective travelling expenses.
The fact that she owns her own property is no business of your IVA supervisor, albeit they will want to understand the basis of the shared costs. Seek more case specific advice about splitting expenditures from your own IP directly.
Thank you for your reply, I am trying to work out the figures before I speak to my Supervisor and see what they say, I think I understand what you are saying, so for example if the mortgage is £650 a month I pay 43% and the Wife pays 57% so I pay £279.50 and she pays £370.50 both added together = £650
The same would apply to things like Water, Electric, Gas, Council tax, insurance.
What about things like hair and clothing allowance ? on my IVA for a single person I think I have down £15 hair and £30 clothes a month as this is now a couple income and expenditure I have read there are guide lines on this, I have seen a recommended guide line for a couple for clothes and footwear are between £45-£50 a month, My Mrs spends quite a bit on clothes and footwear her self as this is her "treat" why should she have a cap on this ? same goes for her hair and other beauty treatments, her hair alone is about £70 a month and I have seen the guide line for both between £18-£22 ? Would this stay as single for both as it seems she is being penalised for my debt/IVA
So once both (mine and the Mrs) expenditure payments are sorted and taken away from both joint incomes the IVA payment made is my 43% of whatever is left over (Supplus) with the rest going to the MRS ?
I am obviously not an expert but if your wife is not in an IVA herself, it is only you that can "claim" the expenditure. So your Income and Expenditure would be worked out with your income and your share of all expenses as above and then you would have the allowances applied (for you only) and that will leave your disposable income. You will only therefore be able to claim the single allowance as your wife's non essential expenditure is not included in the IVA, only your share of the household expenses. I am happy to be corrected on this obviously.
Is there anyone else out there that can confirm the above post ?
As stated before I dont see it fair that my Wife would have to contribute to things like "hair" "medical" "Dentist & Opticians"
From the information that Melanie stated with my take home pay
@ £1500 a month and my wife's & £2000 = ££3500 a month total income
The Percentage I would pay is 43% (if someone could explain how this is done)
The Expenditure is as follows for joint HOME EXPENDITURE
Mortgage £650 mth
Insurance, contents and building £25mth
Council tax £130 mth
Ground rent £13 mth
Flat maintaince (company that clean and keep the upkeep of the flat outside) £30 mth
Water £26 mth
Gas £50 mth
Electric £30 mth
Tv licence £13 mth
Sky tv,broadband,phone line rental,home phone,2 x mobile phones £160mth
Housekeeping, cleaning, £400 mth
Total for joint house expenditure = £1527 month / my 43% = £656.61
My expenditure what I am paying now for single person
Public transport £75mth
petrol £160mth
car insurance £30mth
Road tax £25mth
Mot and car maintaince £22mth
Rac breakdown £7mth
Health and dental £20mth
Hair £20mth
Hobbies - Gym - £25mth
Contingency £20mth
Total = £354mth
Joint living expenditure my 43% = £656.61
My single monthly outgoings = 354
Total £1010.61
Minus My take home pay £1500 a month = £489.39
New IVA payment £489.39mth
Current single Iva payment £220mth
That seems one hell of a big jump !
Anyone have any suggestions on how to lower this ? have I missed anything off ?
Thanks for your reply Clare, I knew there where things I had missed off, meals at work, clothing,
If I can ask, why have you listed housekeeping uner single person ? I thought that as a couple living together this could be under a couple budget, or is it that the IVA is in my name and is my debt that is the reason why it goes under single person allowance so it will not affect my Wifes outgoings ?
I will be speaking to my IP soon but my Wife wants me to find out as much information beforehand so that it will not affect her, we might even go and see a financialadvisor.
You can look at this two ways. You could take both yours and your wifes income and do a joint I&E based on your actual bills and the current guidelines or you can do what I've done, just look at your income and the percentage of money you earn and on your expenditure just put 43% down for any joint expenses you have (mortgage, utilities etc).
If you did a joint I&E and included your wife's income and the total household costs, you MAY (only may) have a slightly higher disposable income, thus meaning that your IVA payments will increase a bit more than you'd like. All of the household costs (mortgage, utilities etc) are what they are and then the other stuff such as food, clothing etc, would be based on a couple. The stepchange guideline for housekeeping for a couple is currently £341 and 43% of that works out as £147....... However saying that your IVA was approved with a housekeeping budget of £400 and 43% is still only £172, so therefore if you separate everything, the 'allowances' work in your 'favour' as a single person allowance.
Hope that makes sense!
However, this is something you are going to have to speak to your IP about and the chances are, they will work to the way they calculated your expenses at the outset.
If you did a joint household I&E, it could look something like this:
Income (you) £1500
Income (wife) £2000
Total Income £3500
Less:
Mortgage £650
B&C Insurance £25
Council tax £130
Ground rent £13
Flat maintenance £30
Water £26
Gas £50
Electricity £30
TV Licence £13
Satellite £23 (based on guidelines for a couple)
Housekeeping £341 (based on guidelines for a couple)
Telephone £74 (based on guidelines for a couple)
Clothing £53 (based on guidelines for a couple)
Dental/Optical £25 (based on guidelines for a couple)
Meals at work £72 (based on guidelines for a couple)
Entertainment £22 (based on guidelines for a couple)
Contingency £23 (based on guidelines for a couple)
Hairdressing £21 (based on guidelines for a couple)
Car Maintenance (2 cars) £60
Car Insurance £60 assuming your wifes is the same as yours
Car Tax £50 assuming your wifes is the same as yours
Fuel £320 assuming your wofes is the same as yours
Your public transport £75
Total Expenditure £2186
Income minus expenditure = £1314
Your wife earns 57% of the household income so 57% of £1314 = £749
You could put an 'allowance of £749 into your I&E for your wife's credit commitments, but it still leaves a DI of £565 which is what would be left over for your creditors, thus increasing your IVA payments even more.
If I were in your shoes, I would request that a 43% of household bills are put into your I&E and a single person allowance is given for the remaining expenses. As you are newly married, this could hold some weight with your IP.
Thank you so much for your reply, it has opened my eyes more and will discuss this with the Wife in more detail, if I am not happy with what my IP puts forward to me can I reject it and state my reasons for what I want pit forward ?
You really need to have a discussion with your IP about this. They will decide on how your I&E will be calculated. You can 'reject' what your IP is saying, however his/hers ultimate aim is to get the best return for creditors whilst making it affordable for you.
If you're struggling with your payments, then your IP needs to be aware and they need to look at why. A decent IP will take your concerns on board and work with you, not against you.
As Clare says you do need to confirm with your IP how they will present it in your IVA as many IPs present the joint picture as you are now married. They will look at all the joint expenditure inc joint allowances as Clare has described below then split it proportionally. What is left as your wife's share will be put as a line in the budget so it comes out of the equation for IVA payment - her money can then be spent on her personal costs - travel etc and whatever else she wants - clothes, higher haircut costs, creditor repayments etc. Your share, once it has had your remaining personal costs deducted (car, travel, etc) will then form your IVA payment.
It is a good idea to try and be clear before you speak to your IP but really it is your own IP that should be clearing things up for you. the danger of trying to get too much clarity elsewhere (inc a financial advisor) is that they may confuse you or tell you something that is different from your IP and ultimately it is your IP who is acting for you so theirs are the facts you need to be clear on.
Keep us posted!
Regards, Tina Shortland, Debt Advisory Manager for Melanie Giles at Debt Advice TV.
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