Increasing salary when in an IVA IVA Issue

Summary: Increasing salary when in an IVA - This article explores the consequences of an increase in salary for those in an IVA (Individual Voluntary Arrangement).

Pay rise

You should check your IVA proposal as it will clearly state the procedure should you be lucky enough to receive a pay increase. If your IVA was presented in line with the 'IVA protocol' (as most IVA cases now are) you will be expected to hand over 50% of the net wage increase. This means you pay 50% of the increase to your IVA Company, with the other 50% yours to keep. However, not all IVA's are in line with the IVA protocol, so it is essential for you to check your documents or speak with your Insolvency Practitioner (IP) to be sure how any wage increases will be dealt with.


If your wage rise is small, for example in line with the national average your IP is unlikely to increase your contributions to the IVA. The reason for this: due to inflation your living expenses are likely to increase and easily absorb any small pay increase. An increased payment to your IVA only really becomes likely if you have an above-inflation wage settlement or see pay increases for other reasons, such as a promotion.

Annual review

The annual review is a good time to pick up on small changes to income and outgoings. You may be asked to provide a P60 and bank statements that will reflect such changes.

Larger pay increase

As with any significant change of circumstances when in an IVA, it is wise to notify your IVA supervisor as soon as possible. Such changes can then be incorporated into the IVA sooner rather than later. If you delay until the annual review, it may result in you being asked to hand over a large sum to the IP. If this has already been spent, this could lead to an extension of your IVA, an increase in payments to cover the shortfall or even the IVA failing for a breach in terms.


An IVA has built-in flexibility so that as changes occur a balance is maintained whereby you can continue to live reasonably and creditors can continue to be treated fairly. By keeping your IVA supervisor informed of changes to pay levels, as well as changes to expenditure, you'll be doing much to ensure the smooth running and successful completion of your IVA.

The above is provided as information only. does not provide debt advice. You must always seek professional advice before taking any action to resolve your debts.