www.iva.co.uk

Hi,

just trying to get my head around the overtime/additional income etc in an IVA.

Please bear with me, but this is my understanding...

All figures are based BEFORE DEDUCTIONS, tax etc, SO ARE JUST ROUGH CALCULATIONS FOR ILLUSTRATIVE PURPOSES.

Ok, so i have a salary of say 33K, this equates to £2750 a month.

If i earn £3200.00 in a month, will the following happen....

10% of 2750 is 275. I keep this.
50% of the remainder is £87.50 (half of £175 which is difference between £3200 and £3025)

£87.50 this month would be payable to the creditors.

am i in the right direction, or completely wrong!

You are absolutely right! Well done! And I usually suggest to my clients that they keep an excel spreadsheet going so that this can be easily worked out each month as you get paid.

Only on the net earnings though after tax and nic - not on your gross earnings.

This post saved me an extra £100 [:D][:D][:D]
I get an annual performance bonus, last year I paid 50% of my net bonus into my IVA because I thought that was the correct calculation.
I have just received my 2009 bonus and because of this post I rang my case administrator to clarify the correct calculation, she confirmed I could keep 10% of my net salary deduct this amount from the net bonus and pay 50% of the remainder into the IVA, result an extra £100 for me. [:D][:D][:D][:D]
It just goes to show how valuable the advice of the Forum's experts can be, had it not been for their expertise I would have continued in ignorance [;)][;)][;)]
Thank you experts [:D][:D][:D]

I thought this was only for the newer IVA's, but I'm pleased it's worked out for you Northumbrian!

Good to see we can get a grasp of things and get it veryfied. When mine starts if I earn extra I am going to set aside 50% of the total net to make extra sure I don't get it wrong. By not counting the 10% it could be a way to build up a bit of unexpected contingency or something.

That's good thinking newbeginnings. It never hurts to have some contingency.

We save the 10% net in our contingency account, and the 50:50 split amount that we get to keep we spend on a few treats if needed - if not it goes in the weekend away fund rather than just being spent on drink and food !

That's a good way of looking at it newbeginnings

Just spotted this thread - but it relates to a query I have.

If I did additional hours that came to less than 10% of my standard monthly earnings, would I get to keep it all? (I've not yet started an IVA, but assuming I had the 10%/50% clause written in to it)

Yes you would keep it all.
You are allowed to keep anything up to the 10% threshold.
It is any amount over the 10% that has to be split 50/50.

J.

Some companies just do a straight 50/50 split, so make sure you check what is written into your proposal.

If unsure ask your IVA company to specify the amount you're allowed to earn rather than you having to work out the split yourself. I did and know if I earn over £X I need to pay it into IVA. Keeps it simple for me as I don't like to be unsure.

I'm starting to think I really am living up to my username as I certainly feel a little confuzzled.

I'm also hoping Melanie may spot this and be able to clarify this point.

I'm looking to enter into an IVA and am trying to get my head around the 10% / 50% situation. Some months I get the opportunity to work additional hours (which would equate to less than 10% on top on my 'usual' monthly pay). Would I get to keep this (knowing that anything over and above the 10% would then be split 50/50? This was my understanding of the 'rule' but, when discussing the IVA as an option I was told the 10% only applied to salary increases, not overtime, and that any additional hours I worked would be simply be split 50/50.

Whilst I'm looking to pay as much back as possible, I was very surprised by this as I was under the impression that the 10% applied whether it was overtime / additional hours / bonuses or salary increases. I was hoping additional hours (although irregular and far from guaranteed) would enable me to build up a little contingency but, in all honesty, if they are to be split 50/50 straight off, it's really not worth the effort to do the extra work for limited 'reward.

I believe you are correct in what you are thinking.

For example,if you earn £1000 per month take home and do £200 overtime, you can take 10% of your take home which would be £100 for you and then comes the 50/50 split from the extra £100 you have earned that means you would pay £50 extra to your IVA and keep the other £50.

It's all relative though and will depend on how many extra hours you really want to work in your life if you do the maths.

I was under the impression that this is for overtime and bonuses and that cost of living pay rises come under annual review when cost of living, I/E will also have increased.

Promotion from your current post with a pay increase would be different as that would be an increase in true income.

HTH xxx