Holiday pay and double payslip after new job

Depero

Hello, 

I'm in my first 6-months of my IVA. I have recently changed job and have made my IP aware of the change and increase in salary. Because I was still at my previous job for the first week of the month, I received two payslips this month, one from the old job (including the week of work and holiday pay I had accrued and not taken) and one from the new job for the remaining of the month. It is higher than my previous monthly income both because of the holiday pay and because I'm better paid at the new job. The IP said I'd have to submit the two payslips and they would calculate the 'extra income' - but it's not extra income as I didn't work extra, just at two different places for a totality of one month. my IVA says they can't consider an increase in my regular income as 'extra income' but that it would be taken into account at review point - which I accept. Can they consider the holiday pay on my last payslip from my old job as extra income and take it? In the meantime, my rent has also gone up by 26% so I doubt the final calculation between the new regular income and my expenses will result in a higher monthly contribution towards the IVA when I get reviewed at the end of the year. I've provided proof of the increase of my expenses together with the two payslips. But I can't find anything that defines holiday pay in the context of an IVA. It is part of my pay and it's taxed, can they still take it? 

fatbelly

I would say 'holiday pay' is still pay unless specifically excluded in your agreement, which it won't be.

See how it pans out ant review and if necessary argue then

sourcrates

Your annual review won`t be for a year, and then they only want to see three months worth of payslips/bank statements.

This will be a non issue, they don`t look too closely at what you send them, its more of a box ticking exercise.

Never tell your IP anything !!!!

Depero

thank you both. they won't ask for bank statements for the whole year at the annual review?

sourcrates

3 months is standard, and is what they ask for.

You have entered an IVA because I assume you have a house to protect, and your debts are in the region of 40k plus?

Depero

No I don't have a house and on hindsight an IVA could have been avoided given the changes in my circumstances six months on, but my creditors didn't agree to a DMO and I couldn't afford payments at the time so it seemed like the only option. I'm hoping to be able to clear it off sooner than the five years and just suck it up in terms of bad credit for the next 6.

Depero

No I don't have a house and on hindsight an IVA could have been avoided given the changes in my circumstances six months on, but my creditors didn't agree to a DMO and I couldn't afford payments at the time so it seemed like the only option. I'm hoping to be able to clear it off sooner than the five years and just suck it up in terms of bad credit for the next 6.

RAS

Depero said:

I'm hoping to be able to clear it off sooner than the five years and just suck it up in terms of bad credit for the next 6.

Can you clarify what you think is going to happen? An IVA lasts a minimum of 5 years and if you haven't got equity to release in year 5, it's generally expended for another year.

There are also IP fees to pay. How much are the ones associated with your IVA? 

A lot of IVAs only ever pay the IP fees with little or nothing going to the creditors. But if you increase income massively or get a windfall, it's possible to pay back the full amount of debt and the IP fees on top of that.

sourcrates

Not many IVA`s stick to 5 years, most are extended by at least one year, and depending on circumstances up to 2/3 years more.

How much debt do you have?

Depero

My debt is not big. The total amounted to 9,700 of which 6,060 was approved. total fees on top of that are 3,650 and I currently pay 100 per month. I reckon I can afford more per month after my first review so the total approved debt will probably go up from 6,060 right? but it can't go over the 9,700 and the fees will stay the same for 5 years. When I say that I think I'll be able to finish it off early (which is possible) I refer to a considerable increase in income which is expected in my position/job. But even if that doesn't happen and I make all my payments as agreed for the next 5 years, why would they have to extend it? 

stu12345_2

it can't go above the total amount you owed creditors plus the insolvency practitioner fees.

if you got a huge rise you would stop paying once you pay both those amounts off or it all ends in 5 year whatever comes first.

but if the total you managed to pay off in 5 yes isn't enough and you own a home then you remortgage in yr 5 , making you pay another year


the downfall is for folk that owe not too much like you but end up in a higher paying career , so have to pay the fees on top. of the original creditors debts

that's why if you owe what you owe and you up your wages payments you could end up paying more than you would in a dmp that had early settlement discounts