Hi. I have been in a DMP since March 2010. I owe around £75,000 to 6 creditors. The majority of this, £30,000, is owed to Tesco Finance who have recently succeeded in registering a CCJ against me as they refused to 'officially' accept my DMP, although the have been accepting the reduced payment. I understand Tesco would be crucial in gaining acceptance for an IVA, as they hold more than 25% in value of my total debt. Is this correct? Is it different now because they have a CCJ?
Also, as I am self employed, will I need to prove income for an IVA assessment?
Hi Mark and welcome to the Forum.
Your DMP is clearly not working and given the level of debt may not be the best option anyway. Now that Tesco have the charge they may move to secure the debt on your property if you own one but at least an IVA would offer protection from legal action. It usually does not affect the voting whether there is a CCJ or not provided the IVA meets normal criteria.
Being self employed you should be saving each month to meet future tax bills unless the tax is deducted at source under the CIS scheme. Yor chosen IP will assist you in drawing up a set of cashflow projections or profit and loss accounts on which your IVA payments would be based. This is relatively straightforward and the case is reviewed as normal once your accounts are submitted. Any outstanding debts to HMRC are included in the IVA including the debt for 2010/11. This allows you to start 2011 with a clean slate and lets your business grow without being strangled with debts.
Seek some free advice from an insolvency firm before your situation gets worse.
Hi Mark - welcome to the forum. Yes you are right in that any creditor who holds more than 25% of your overall debt does have a majority vote and if vote no, will block your ability to get an IVa accepted. That is not to say they will block your IVA though just becasue they have refused your DMP.
Self employed income if fine for an IVa as long as you have accounts to prove it and are realistic about what your earning will be. You should contact two or three companies to talk your situation through and get some free advice. Picking an IP who has lots of experience in representing self employed clients would be a benefit - there are companies on here who come highly recommended and who are reviewed on www.iva.com
Regards, Tina Shortland, Debt Advisory Manager for Melanie Giles at Debt Advice TV.
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Did Tescoe say why they wouldn't accept your DMP? I'm currently in a DMP with them and have been so since Feb 2009 and so far they have been more than happy to deal with me. I'm not currently paying any interest at all on the outstanding loan which is around £11,000 and they just seem happy to do a six month review.