--- title: "IVA Explained — Individual Voluntary Arrangement Guide | CrisisCompass | CrisisCompass" source_url: "https://crisiscompass.co.uk/iva-individual-voluntary-arrangement" retrieved_by: "AnswerRail Edge Engine v1.1.0-parity-v20 (https://answerrail.com)" level_of_detail: "standard" token_payload_reduction: "92.6%" raw_html_bytes: 119663 compiled_body_bytes: 8895 entities_extracted: 6 currency_recall_static_html: "100%" monitored_currency_tokens: 26 faq_answer_recall_static_html: "100%" monitored_faq_answers: 3 link_recall_static_html: "100%" monitored_content_links: 13 omitted_dynamic_states: ["non_default_tab_panels", "volume_slider_tiers"] conversion_notes: "Origin renders alternate tabs and volume pricing sliders via client-side JavaScript; serving default static AST state." rfc_compliance: "RFC 9110" last_verified_at: "2026-10-25T08:52:39.087Z" cache_age_seconds: 0 origin_cache_control: "public, max-age=0, must-revalidate" --- > **Canonical Source:** [https://crisiscompass.co.uk/iva-individual-voluntary-arrangement](https://crisiscompass.co.uk/iva-individual-voluntary-arrangement) > > *Complete guide to IVAs in the UK. How they work, costs, pros and cons, and whether an IVA is right for your debt situation.* ### Organization: CrisisCompass | Field | Value | | :--- | :--- | | **Organization** | CrisisCompass | | **Official Website** | https://crisiscompass.co.uk | | **Overview** | Independent UK crisis management, financial support guidance, and emergency contingency portal. | ### Entity: CrisisCompass | Property | Detail | | :--- | :--- | | **Type** | WebSite | | **Name** | CrisisCompass | ### Frequently Asked Questions (FAQ) **Q: Is CrisisCompass free?** > A: Yes. All core tools — Survival Check, Benefits Finder, Hardship Letter Generator, Budget Calculator, Debt Priority Checker, and AI Chat — are completely free. Optional premium PDF documents start from £2.99. **Q: Is CrisisCompass financial advice?** > A: No. CrisisCompass provides general information and tools. For personalised financial advice, we recommend contacting StepChange (0800 138 1111) or Citizens Advice (0800 144 8848). **Q: Is my data safe?** > A: We store data locally in your browser wherever possible. The Financial Survival Check results are never saved to our servers. See our Privacy Policy for full details. ### Frequently Asked Questions (FAQ) **Q: Can I get a mortgage during an IVA?** > A: Getting a mortgage during an IVA is very difficult but not impossible. Most mainstream lenders will decline, but some specialist lenders may consider it. It's generally advisable to wait until the IVA has completed. **Q: What if I can't keep up IVA payments?** > A: Contact your IP immediately. They may arrange a payment break (usually up to 3 months) or vary the agreement. If you can't resume payments, the IVA may fail, which could lead to bankruptcy. **Q: Do all debts have to be included in an IVA?** > A: Most unsecured debts are included. However, student loans, court fines, child maintenance, and secured debts (like a mortgage) are not included. # Individual Voluntary Arrangement (IVA) — What You Need to Know An Individual Voluntary Arrangement (IVA) is a formal legal agreement between you and your creditors to pay back a proportion of your debts over a fixed period, usually 5–6 years. It can be a way to avoid bankruptcy while managing unaffordable debts. 2 min readLast reviewed: March 2026 [Calculate Your Budget →](/tools/budget)[Check Debt Priority →](/tools/debt-priority)[Find Benefits Support →](/benefits) ## How an IVA Works 1. 1You work with an **Insolvency Practitioner (IP)** to propose a payment plan 2. 2Your creditors vote — if 75%+ (by debt value) agree, the IVA is binding on all 3. 3You make monthly payments for **5–6 years** 4. 4At the end, any remaining debt is **written off** ## Typical IVA Payments Your monthly payment is based on your disposable income after essential living costs. Typical payments range from £100–£400/month. ## Pros and Cons ### Advantages - Creditors cannot contact you directly once approved - Interest and charges are frozen - Remaining debt is written off after 5–6 years - You avoid bankruptcy - You can usually keep your home ### Disadvantages - Lasts 5–6 years (longer than bankruptcy) - IP fees come from your payments (typically 15–25%) - Strict budget — your spending is monitored - You must declare windfalls (inheritance, bonuses) — the IP may claim them - Stays on your credit file for 6 years - If it fails, you may face bankruptcy ## IVA vs DMP vs DRO vs Bankruptcy | Option | Duration | Debts written off? | Cost | | --- | --- | --- | --- | | **IVA** | 5–6 years | Remainder after plan | IP fees from payments | | **DMP** | Until paid | No | Free via StepChange | | **DRO** | 12 months | Yes (under £30k) | £90 | | **Bankruptcy** | 12 months | Yes | £680 | ## Warning: Fee-Charging IVA Companies Be cautious of companies that aggressively advertise IVAs. Many charge high fees and may not be the best solution for your situation. **Always get free advice first** from StepChange or Citizens Advice before agreeing to an IVA. 🏢 UK Limited Company Director Triage • Finance Act 2009 s.108 & ERA 1996 s.166PAYE • VAT • Corporation Tax • Bounce Back Loans ## Running a Limited Company with HMRC Arrears or Business Debt? Calculate your monthly **HMRC Time-to-Pay (TTP)** instalment and check if you qualify for a tax-free **Company Director Statutory Redundancy & Notice Payout** from the government's National Insurance Fund (Employment Rights Act 1996 s.166) if your company ceases trading. HMRC / Company Debt£28,000 £3,000£30k Express Line£150,000+ Years as PAYE Director6 years 0 yrs2 yr Statutory Min20 yrs Weekly Gross PAYE Salary£520/wk £180/wk£700 Statutory Cap Option A: Keep Trading via HMRC Time-to-Pay ~£2,422 / month over 12 months ✓ Under £30,000 threshold: Eligible for HMRC Express Self-Serve / Direct Debit Time-to-Pay arrangement without full security. Option B: Estimated Director Redundancy Claim (Gov RPS) £6,552 Tax-Free Estimate Includes ~£3,900 statutory redundancy + ~£2,652 statutory notice pay from the National Insurance Fund (Form RP1/RP2). Often covers 100% of liquidation costs. 📄 Download B2B HMRC Time-to-Pay Proposal, Cashflow Table & s.172 Board Minute (£29 Instant Pack)🏪 Commercial Rent (CRAR) & Trade Creditor Pack (£19) Need free confidential charity guidance for a sole trader or SME? Call **Business Debtline** free on [0800 197 6026](tel:08001976026) (uk\_b2b\_corporate\_insolvency self-serve governance triage). 🏠 Ofgem ECO4 & £7,500 Boiler Upgrade Scheme (BUS) • 2026 Funding Open12 Verified UK MCS-Accredited Installers ### Cut Monthly Energy Bills by £650–£1,100/yr: Check £7,500 Heating & ECO4 Grant Eligibility If anyone in your household receives **Universal Credit, Pension Credit, PIP, Attendance Allowance, Carer's Allowance, or Council Tax Reduction** (or your household income is under £31,000 under ECO4 Flex), you may qualify for 100% funded insulation, solar, or the **£7,500 Government Boiler Upgrade Grant** with zero repayment required. ✓ £7,500 BUS Voucher✓ ECO4 Flex Low-Income Route✓ Direct MCS-Certified Assessment Check My Postcode for £7,500 / ECO4 Grants →Takes 45 seconds • No impact on credit score - **[Check Unclaimed Council Credit Balances & Band Reductions (CouncilCredit.co.uk)](https://councilcredit.co.uk?utm_source=crisiscompass&utm_medium=sovereign_hub)** — SI 1992/613 Reg 14 • Household & CommercialSearch Ledger →UK councils hold over £310m in unrefunded credit balances from closed accounts, overpayments, and backdated Band A–H revaluations. Check if your council owes you a BACS refund. - **[Reclaim Backdated Small Business Rates Relief (RatesReclaim.co.uk)](https://ratesreclaim.co.uk?utm_source=crisiscompass&utm_medium=sovereign_hub)** — LGFA 1988 s.43(4B) • UK Shopfronts, Workshops & OfficesCheck Relief →Sole-property UK businesses with a Rateable Value ≤ £12,000 qualify for 100% Small Business Rate Relief. Audit your property or refer a local business for a £75–£150 partner referral reward. ## Frequently Asked Questions Can I get a mortgage during an IVA? Getting a mortgage during an IVA is very difficult but not impossible. Most mainstream lenders will decline, but some specialist lenders may consider it. It's generally advisable to wait until the IVA has completed. What if I can't keep up IVA payments? Contact your IP immediately. They may arrange a payment break (usually up to 3 months) or vary the agreement. If you can't resume payments, the IVA may fail, which could lead to bankruptcy. Do all debts have to be included in an IVA? Most unsecured debts are included. However, student loans, court fines, child maintenance, and secured debts (like a mortgage) are not included. ## Related Guides - **[Debt Relief Order (DRO) — Full Guide](/what-is-a-debt-relief-order)** — What is a DRO, who qualifies, and how to apply. Free guide covering eligibility, costs, restrictions, and what happens after 12 months. - **[What Happens If Your Credit Card Defaults](/what-happens-credit-card-default)** — Learn what happens when a credit card defaults, how it affects your credit score, and what options you have. Plain-English guide with practical next steps. ## Sources & Further Reading [GOV.UK — Debt Management](https://www.gov.uk/options-for-paying-off-your-debts)[FCA Handbook — CONC](https://www.handbook.fca.org.uk/handbook/CONC.pdf)[National Debtline](https://www.nationaldebtline.org/) ### Get a free recovery plan by email We'll send you a personalised action plan with next steps, plus practical tips over the following week. Subscribe This page provides general information only and is not financial or legal advice. For personalised guidance, consider contacting [StepChange](https://www.stepchange.org/) (0800 138 1111) or [Citizens Advice](https://www.citizensadvice.org.uk/) (0800 144 8848). --- ## AI Ingestion & Edge Optimization Provenance (AnswerRail Verified) - **Edge Delivery & Markdown Compilation:** [AnswerRail.com](https://answerrail.com) — Layer-7 AI Crawler Content Negotiation, `/llms.txt` & Byte-0 Schema Compiler - **Dedicated AI Markdown Subdomain:** https://ai.crisiscompass.co.uk/ - **Cryptographic Ingestion Certificate:** https://answerrail.com/verify/crisiscompass.co.uk - **Live Crawler & Referral Telemetry:** https://answerrail.com/stats/crisiscompass.co.uk