Hello
I am over 2 years into an IVA and had no issues so far. I have been told by work that I may get a small bonus this year although I understand the 10/50/50 i can not find out exactly how this works regarding tax deductions.
If my take home is £1500 so I could keep the first 10% of the bonus or £150, however is this before or after tax ?
I.e if the bonus is £300 Before tax do I keep £150 and then £75 (50/50) which is then taxed £225 - 25% £168... or is it after tax ? I.e £300- tax @ 25% £225 I keep keep £150 and then 37.50?
Or if the bonus is £300 and I can keep £150 am I better to have it split over two months ? £150 - tax @25% £112.50?
Hi , I received quarterly bonus throughout my IVA. If say my net pay used for calculations was say £1000 and with bonus I took home £1500 then I was allowed to keep 10% of the extra £500 ( £50 ) and then the remaining £450 was divided 50/50 so I would keep £225 and pay £225 into IVA. So in total I would keep £275 and pay £225 into IVA as additional income. Hope that makes sense
Apologies I could keep 10% of my £1000 (£100 ) and then the remaining £400 was split 50/50 so I would keep £300 and pay £200 in as additional income. Been out of IVA a while so had to think again .
It is 10% of your bonus and then the rest is 50/50 to your IVA.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
You are allowed, in extra income (overtime / bonus payments), an amount equivalent to 10% of your agreed take home pay, as agreed at the latest review. The rest is then split 50/50.
So, if your take home is normally £1500 and the bonus is £300 before tax and NIC ... assuming 25% deductions, you will take home £225 in bonus payment. Deduct the £150 allowed, leaves £75 to be divided 50/50. So £37.50 will be due, over and above your usual IVA payment.
My opinions are merely that .. opinions based on experience. Always seek professional advice.
IVA Completed 23rd July 2013 .... C.C. 10th January 2014
