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Individual Voluntary Arrangement (IVA)

An Individual Voluntary Arrangement (IVA) is when a debtor enters into a contractual agreement with their creditors. This is a way of avoiding bankruptcy, protecting them from legal action while they make manageable payments over an agreed time period.

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What is an Individual Voluntary

Over a set time, normally 60 months, you make contributions to an Insolvency Practitioner (the Supervisor of the IVA) who then makes creditor repayments in accordance with the laws of The Insolvency Act 1986.

An IVA protects you from creditors who are owed sums at the date of the IVA and makes your debt more manageable.

The amount you pay back depends on your individual situation.

The amount you owe, expenditure, living arrangements and your income all need to be taken into account.

For an IVA to be initiated, over 75% of creditors must approve it.

In order for an IVA to be a viable option, you should:-

  • Be insolvent and unable to pay back your debts as they fall due.
  • Owe money to two or more creditors
  • Have debts over £10,000
  • have a surplus income every month or another way to make a contribution to the IVA (maybe from a third party).
ACCAThe Association of International AccountantsICAEW Authorised Training EmployerICAEW Licensed Insolvency Practitioners (UK)Insolvency Practitioners AssociationR3

How does an Individual Voluntary Arrangement take place?


Your insolvency practitioner will write up an IVA proposal stating your plan of action.


You and the Insolvency Practitioner choose what level of contribution you should make and over what period.


Following this, your proposal will be sent to your creditors and they will vote to approve or reject it.


If it is approved of by over 75% of creditors (via debt value), then the IVA is in place.

Points to consider

IVA fees are set up by creditors and therefore it is important you have the right insolvency practitioner processing it.

If you are a homeowner who has equity in your property, you might have to pay part of your share of this equity into the IVA (often in the last year of the IVA).

The amount that needs to be repaid may increase if your IVA lasts for an extended period of time.

If you cannot keep up your repayments and your IVA fails, it is possible you will be made bankrupt.

Your credit rating could be affected after the start of your IVA.

When is a Individual Voluntary Administration a good option?

If you’re looking to avoid bankruptcy proceedings and deal with your debts in a managed way and IVA might be the best option.

An IVA is just one of the many services we offer at our insolvency practice. If you’re unsure which option is best for you, please do not hesitate to contact us.

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We will sit next to you at the table and stand by you.

If you are thinking about a IVA, all you need to do is get in touch with Hudson Weir.

Call us on 020 7099 6086 or

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Hudson Weir are an established firm of Insolvency Practitioners who specialise in business recovery and corporate financial solutions.

Hudson Weir provides industry leading, nationwide services for its clients with the intention of easing financial pressures and providing recovery strategies for struggling businesses.

Hudson Weir Ltd (Company number 09477593) is a company registered in England and Wales.

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