Umbrella Company

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JustPlainStupid
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by JustPlainStupid » Wed Nov 22, 2017 11:38 am
In the interests of speed, I'm going to go with an umbrella company for contracting whilst I try to track down a company that will give me PLI and PII so that I can set up a ltd company. I've found a company called SIS who *might* be able to help - I'll try and post back on this when I know for sure as I know others have had similar problems.

The umbrella company has given me 2 options:

1. Normal umbrella - this will mean that I'm taking home less than I was so I'm guessing my IVA payments will be lowered accordingly

2. Enhanced umbrella - this will mean that I'm taking home more than I was so my payments will increase

The problem with 2 is that they effectively pay you about £300 as salary and then the balance is paid by quarterly bonus. But nobody wants to be paid every 3 months so they advance you your bonus as a loan, which is then cancelled out by your bonus (tax avoidance, moi?). He said that some IVA companies might get twitchy about this.

Anyone had any experience of this?

Cheers
Andy
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Foggy
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by Foggy » Wed Nov 22, 2017 11:47 am
Yes ... they might well get twitchy about option 2, but, as long as you explain it and they see the logic and the creditors are still getting their due, it might work.

Option 1 is dubious -- they will only reduce the IVA payments by up to 15% (assuming you have the normal clauses) -- more than that will require a variation to be agreed by creditors -- they might refuse.
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JustPlainStupid
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by JustPlainStupid » Wed Nov 22, 2017 11:58 am
Foggy wrote:
Yes ... they might well get twitchy about option 2, but, as long as you explain it and they see the logic and the creditors are still getting their due, it might work.


I'm going to give them a call today as I need to take a payment break due to timing. With option 2, they'll end up with the same amount as I should hit 100% but they'll probably get it a year earlier.

Foggy wrote:
Option 1 is dubious -- they will only reduce the IVA payments by up to 15% (assuming you have the normal clauses) -- more than that will require a variation to be agreed by creditors -- they might refuse.


Really? Didn't realise that. I thought the whole point was that you paid according to affordability? They were happy enough to raise my monthly payments in September from £780 to £1595 due to a change in circumstances.
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Foggy
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by Foggy » Wed Nov 22, 2017 12:08 pm
JustPlainStupid wrote:
Foggy wrote:
Yes ... they might well get twitchy about option 2, but, as long as you explain it and they see the logic and the creditors are still getting their due, it might work.


I'm going to give them a call today as I need to take a payment break due to timing. With option 2, they'll end up with the same amount as I should hit 100% but they'll probably get it a year earlier.

Foggy wrote:
Option 1 is dubious -- they will only reduce the IVA payments by up to 15% (assuming you have the normal clauses) -- more than that will require a variation to be agreed by creditors -- they might refuse.


Really? Didn't realise that. I thought the whole point was that you paid according to affordability? They were happy enough to raise my monthly payments in September from £780 to £1595 due to a change in circumstances.


My IP happily reduced my payment when needed to 15% below my initial payment (using that as the baseline, not the increased payments) --- some are better than others. The keyword in the usual clauses is the IP has the discretion -- not obligation!
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kallis3
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by kallis3 » Wed Nov 22, 2017 1:29 pm
Anything above 15% reduction has to be agreed by creditors.
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JustPlainStupid
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by JustPlainStupid » Wed Nov 22, 2017 4:46 pm
kallis3 wrote:
Anything above 15% reduction has to be agreed by creditors.

I just called Harrington Brooks and they were very good about things. Explained that I'd lost my job, was starting a new one, but that there would be a gap before I was back into the payment cycle. The cancelled the DD until Feb and said that they'd add the 2 months onto the end. I have to say, HB do seem to be pretty human when you talk to them. No drama, always respectful and friendly. I don't know if it's because I always talk to them respectfully and calmly. Maybe a lot of people are aggressive so it's a relief for them!

One thing I forgot to ask is about this 15% thing. If my original payment was agreed at £780 but my payments now are £1595, what are the parameters? 15% of £780 is about £120. So does that mean they could reduce my payment to £660 without going back to the creditors, or does it mean they could reduce the £1595 by £120?

Cheers
Andy
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Foggy
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by Foggy » Wed Nov 22, 2017 5:15 pm
JustPlainStupid wrote:
kallis3 wrote:
Anything above 15% reduction has to be agreed by creditors.

I just called Harrington Brooks and they were very good about things. Explained that I'd lost my job, was starting a new one, but that there would be a gap before I was back into the payment cycle. The cancelled the DD until Feb and said that they'd add the 2 months onto the end. I have to say, HB do seem to be pretty human when you talk to them. No drama, always respectful and friendly. I don't know if it's because I always talk to them respectfully and calmly. Maybe a lot of people are aggressive so it's a relief for them!

One thing I forgot to ask is about this 15% thing. If my original payment was agreed at £780 but my payments now are £1595, what are the parameters? 15% of £780 is about £120. So does that mean they could reduce my payment to £660 without going back to the creditors, or does it mean they could reduce the £1595 by £120?

Cheers
Andy


My IP applied the 15% to my initial payment as it had slightly increased. I started out at £400 and it had risen by year two to £460 --- they reduced me to 15% below the £400, so my payment became £340. Remember though - it is up to 15% (at the IPs discretion).
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JustPlainStupid
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by JustPlainStupid » Thu Nov 23, 2017 4:24 pm
Cheers, Foggy.

My intention was to get my head down, make my payments and hit 100% at around 5 years and 2 months. It was painful with the payments doubling a couple of months ago but I figured I'd take my medicine. It took me 4.5 months last time to find a permanent job. Luckily, I got 3 months notice and a month in redundancy so I kept the payments up. This time I only got a week's notice and there's no way I could have lasted more than about a month, which is why I took this temporary contract. Whilst I'm doing this, I'll be taking home about a grand more so I'm going to be feeding £500 a month to the IVA. If at £1595 a month payments I'll clear the IVA in another 38 months, I'm hoping I'll knock 10 months off with the extra £500 if I can maintain the earning level I have now. The problem is that I might get a month with no work. I'm hoping that won't happen but if it does I guess the IP will have to decide whether to add a month onto the end or fail the IVA and lose the lot. My feeling is that I'm probably in quite a strong position to negotiate.

It's highly possible that in 3 months my take home will increase again and my payments will probably go up another £800 to £1000 a month. I'll be paying back just over £3k a month - nearly 3 times what I was paying back before it all went pear-shaped. I was only up the creek for about a year before it all turned around. I do look back and wonder if some sort of deal could have been done for 12 months while I got back on my feet.

Ho hum.
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