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FAQs

Self-employed IVA

Our FAQs answer the most common questions about how a Self-employed IVA works, so you can decide with confidence whether this solution is right for you.

How would a tax rebate be treated in a Self-Employed IVA?
If you’re due a tax rebate for either a tax year prior to the approval of your Self-Employed IVA, or for the tax year in which your Self-Employed IVA was approved, HMRC will – in many cases – either send the rebate directly to your Supervisor or offset it against the outstanding balance on your HMRC account.
What if I lease my business premises?

You may still be able to trade from leased premises if you enter a Self-Employed IVA.

However, there are a couple of things you’ll need to do:

  • Read the lease agreement carefully. In some cases, the lease may state that it’ll be terminated if you enter an IVA or bankruptcy. If your lease does state this, discuss your financial situation with the landlord of the property, and ask whether they’ll actually use their right to terminate the lease if you enter a Self-Employed IVA. If they agree not to terminate the lease, it’s important to get confirmation of this in writing.
  • Check that you aren’t in arrears with payments under the lease agreement, as this could result in the landlord not allowing you to keep the property.

There will be an allowance in your cashflow to make your lease payments when they fall due – plus repayment of any arrears – so the landlord can see that you intend to keep up with your payments.

Even if the above termination clause is in your lease agreement, the fact that you’re taking action to deal with your debts may convince the landlord to ignore this and allow you to continue trading from the premises.

What if I can’t afford payments?
Payments can be adjusted monthly based on your business cashflow. If you struggle, contact your Supervisor as soon as possible as they may be able to arrange a payment break or reduction.
What is the Insolvency Register?
Your name will be listed on this public register during your and for three months after your IVA completion, but it’s primarily accessed by creditors and lenders.
How does the IVA affect my credit rating?
Your IVA will stay on your credit file for six years, affecting your ability to borrow. After completion, it will be marked as complete on your file.
Do I have to keep paying tax, National Insurance and VAT?
Yes – you must keep paying these as usual during your IVA. You can include any tax or National Insurance owed up to the end of the tax year in which your IVA is approved, as well as any VAT arrears up to the start of your IVA.
Can I keep my business bank account?
You can usually keep your business bank account. However, if it’s significantly overdrawn or linked to other debts with the same bank, you may be advised to open a new account to protect your money.
What fees are involved?

Our sister company, PayPlan Bespoke Limited, manages the IVA arrangement. Their fees are included in your monthly payment and are only deducted once your IVA is approved by creditors. If your proposal is rejected, you won’t be charged for the work done so far.

The fees for an IVA are split into two types:

  1. A Nominee’s fee of £2,300 and
  2. A Supervisor’s fee of up to £40 per month, based on the level of your payments.

If any additional sums are paid in during the term of the IVA, a further fee of 20% of the funds received may be applied.

How are payments calculated?

You’ll create:

  • A business budget projecting income and expenses for 12 months, including tax and National Insurance provisions.
  • A personal budget covering household costs like rent/mortgage, bills and essentials. The money left over after expenses is what you can afford to pay your IVA each month.
What if I owe money to my suppliers?
A Self-Employed IVA has a degree of flexibility so you can prioritise payments to suppliers who you need to keep trading with.