www.iva.co.uk

I am in the last year of an IVA, I have retired from my job but started another one, If I have a lump sum as a result of my work pension, as this is to buy a house for our future, can the IVA take this towards my creditors ?? We were advised at the beginning that this would be safe, but now I am reading that this might not be the case. HELP !!!

If you draw down the pension lump sum before the end of the IVA it is possible that it could be captured by the windfall clause. If it was specifically excluded you should be fine but speak to your own IP who will have full knowledge of your file. It may be best to defer the pension until the IVA is completed.

The dictionery definition of a windfall is monies which are not expected, as a pension would be expected why should it be treated as a windfall. Also why does it have to be specifically excluded why should it not be specifically included

Unfortunately dictionary definitions are superceded by the proposal's definitions and a windfall, for those purposes, is a sum of unearned money.

I assume you mean the IVA proposal? So what if the pension is neither
specifically include or excluded, and are pensions not ringfenced and therefore protected?

Could offer a full and final Stuart on the premise that you will only draw down on the pension if this is accepted.
May be offer the final 12 months payments.

silly billy wrote:

I assume you mean the IVA proposal? So what if the pension is neither
specifically include or excluded, and are pensions not ringfenced and therefore protected?

The way I understand it is that anything not specifically EXcluded is, by default, INcluded. A pension isn't automatically ringfenced, nor protected, however, most IP's do seek to have them excluded, and, if your IP advised you that it was safe, he should have taken the trouble to exclude it.

When we first spoke to thm we explained that I would be retiring and that I would commute to get a smaller pension and a lump sum, as this was to purchase our house for the future, thye did say that the pension was safe, but now I am into the final years review, and dont want to declare it in case they take all of the lump and leave us with no future as we had planned

Hmmm .. have you checked your proposal for any exclusions ? You could, without committing yourself, drop him a line and mention that the time is drawing nigh and could he confirm that, as previously discussed, any sum commuted from your pension will be excluded and not payable as a windfall ( or under any other title) to the creditors. Infer that if it was to be treated as a windfall you will not commute.

Write to him and, hopefully, you will get a response in writing.

Hi Stuart - good advice from Foggy. You need to check with your IP before drawing down a lump sum from your pension. In the meantime, the excluded assets section of the proposal will list the pension if it has been specifically excluded.

My pension is not mentioned at all in my IVA even though I can (new pension rules allowing!) retired before the end.

If I do, then I expect to pay some of my lump sum across to pay off my debts.

However, with these new pension regs it will probably mean that I can't go until after the IVA has finished. Great for me, but not for the creditors.

Jan, the "plan" is to extend your retirement age (and mine) everytime you get close to it ... that way you will NEVER retire, so they will save a fortune on pension payments .... but don't get me started on that, it's a sore point right now !!

If there is any doubt in your mind about how this should be treated - and none of us can give specific advice as we don't know the facts of your case - you should seek legal advice. A pension pot is far too valuable to give up unless you have to, and this is a bit of a grey area for all professionals to be frank.

Thanks for all the advice and thoughts, will have to dig out my agreement and read to see if its excluded, if not will have to take some legal advice, as I have only 12 months to go for IVA to be completed.

I hope the next 12 months run smoothly for you Stuart. x