www.iva.co.uk

Hello all

I am two years in to my IVA and generally speaking, things are going well. However I do have one small grudge.

Basically, I am on a zero hour working contract (so my hours are never guaranteed). Last year I earnt £10,800 (it depresses me when I say this) after tax, and pay £145 towards my IVA. This was £250 but I moved in to my own flat five months ago.

Anyway, because my hours are never guaranteed, we (me and my IVA company) work on the assumption I bring home about £900 per month (£10,800 divided by twelve months). Now whilst I agree the terms of my IVA state that if I earn any overtime and/or bonuses, then I have to pay 50% of anything over the 10% threshold (ie I am allowed to earn £990 before paying any more money in to my IVA).

Now my problem is this;

As I am on a zero hour contract, I NEVER do overtime nor do I earn any bonuses. But if I earn over £990 I have to pay 50% of whatever I earn over that. Now if I earn say £950 two months running, then I am not expected to pay any more than the £145. However if one month I earnt £1050 and the next I earnt £750 then I am expected to pay a further £30 over this two month period (£1050-£990/2). And this happens a lot!! So even though on average I can earn less than the stated £900 over a two month period, I am expected to pay more!!!!!!

How can this be fair? I am really not happy about this.

I have the same issue (although not due to a zero hours contract) & it has been agreed with my IVA company that my pay will be assessed on a 12 monthly basis, ie, what I earn over the year is divided by 12 & if this does not exceed my monthly 'allowed' income then I don't pay any extra (obviously you would need to keep track of this throughout the year to ensure that you have the means to pay over any surplus as a lump sum).
I imagine this is how it would work for someone who is self employed where income fluctuates so your IP should have come across this before.

I just don't think it's a fair system. At least four or five months of the year, I bring home less than £900 but I am still expected to pay my £145 IVA. How can it be right if I bring home £1100 and £600 in consecutive months, I have to end up paying more?

Hi

It can't be right and fair

Any high months should first be set off against the low months

Best way forward would be to pay the set 145 each month and a review taken place every six or 12 months to capture 50% of any additional earnings

Regards

This does not sound fair and I agree with Andy. Speak directly to your IP and request a full review with the answers in writing.

Thanks for your replies. I shall speak to my IVA company about it. To be honest, whenever I earn less than £900 I don't even quibble about paying the £145. I just pay it. But it means I have a very tight month. I brought home £760 two months ago and then last month I brought home £1030 which meant I had to pay another £20 on top of my monthly payment, even though the average for the two months was slightly below the agreed £900. Like I say, this happens regularly.

probably to complete a 3 or 6 monthly review of average earnings may be possible, I do think you need some leeway though on your short months and hope your IP can see how unfair this is as to be continually short of money is not a nice feeling as things are tight enough in an IVA

I had the same problem. My average earnings at the start of my IVA with the 10/50/50 rule for overtime. When my second job was cut I earned £100 a month less..I was told if I reduced my monthly payments, the arrears would be capped on the end. I decided to struggle on until my hours went up again. Its seems if you earn more you pay more, if you earn less, you pay the same or cap it on the end...This is how my own IVA seemed to work. When my hours where cut again with two payments to go, where I had no surplace, I was advised to borrow the money to make the last payments and complete the IVA - which I did.

Hello all

A very strange development has happened with regards to my post here. On Wednesday, I had a message from a lady at my IVA company who I have never spoken to before. She wanted to discuss my IVA, and in particular, the fluctuations with my wage on a monthly basis. I phoned her this morning, but was told she was off until Monday, so I sent her an email. She replied earlier and said 'I agree from reviewing your financial information that we need to account for the fluctuations in your wage re the overtime rule and this is why I contacted you.'

Seems I might have won . Though will see what she says on Monday. But the fact she agrees with what I am saying is a big step forward.

Nice result and hopefully some of the advice here helped. Good to see any IP firm admit possible mistakes and correct them. We all make mistakes but how we deal with them makes the difference.

Sounding positive so that is a step in the right direction...fingers crossed for me.

Thanks guys!!!! I have stated that when I earn more than 10% over my average monthly income, I am happy to pay 50% of anything I own over it. But I would like some leeway when I earn significantly less.

can't be fairer than that. Let us know and fingers crossed here for you.

We have paid so far an extra £3500 into our IVA through the 50/50.

We have to do our figures every two months, these next two months we will be way BELOW our income because our holiday pay will not include any overtime whatsoever. There are quite a few times when we are below our aloud income and just have to go short. When I get back to work and start doing all the overtime which is always a regular thing then we will be paying some over!!!!

We have asked quite a few times to do our figures over a longer time scale but they wont have any of it!

Baldy

How can it possibly be fair. You're obviously paying more in to your IVA every month but whilst I am happy to pay the extra should I earn over the 10% then surely some leeway needs to be given if we bring home less.