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Struggling to pay - individual voluntary arrangements

This advice applies to Northern Ireland

This page tells you what to do if you have an Individual Voluntary Arrangement (IVA) and your financial circumstances change, making it hard for you to keep up your payments. For example, if you lose your job.

Missed a payment

If you've already missed a payment, contact your IP straight away. Otherwise your IVA may be at risk.

More about what to do if you have missed a payment

You can no longer make payments

If your circumstances change and you can no longer make the payments into your IVA, you should tell your insolvency practitioner (IP) straight away. For example, you may have lost your job or had to accept reduced hours at work, or your costs have gone up.

Short-term financial difficulty

If you are struggling financially due to unforeseen circumstances, and your IVA has been drawn up under the IVA protocol, your IP can agree a payment break for up to six months without the need to ask your creditors. This may be appropriate if you have just lost your job or have to go on maternity leave. It gives you some breathing space until you can get your income back on track.

If your IVA was set up after July 1st 2012

If your IVA was set up after July 1st 2012, and it has been drawn up under the IVA protocol and you have a temporary emergency financial situation, your IP can agree a payment break for up to three months without having to get agreement from your creditors. An emergency would be any sudden unexpected expenditure that means you can’t make your IVA payments. For example, the car you need for work is stolen and you have to pay your insurance excess. Or a problem with your bank means you aren’t paid on time.

You will have to provide evidence to your IP about your change in circumstances.

If you have a payment break you will be expected to pay your missed monthly payments at a later date.

Long-term financial difficulty

If your financial situation has got worse and is unlikely to improve, your IP may be able to change the IVA for you to make smaller monthly payments. You can only change the IVA if your creditors agree. The IP may charge you a fee for changing the IVA in this way.

If the creditors don’t agree to the change, and you can’t keep up your payments, your IVA will fail. You could be made bankrupt or you will have to find another way to pay your debts.

Some IVAs say that if your circumstances change, the IVA can be altered to accept lower payments. Check your IVA to see if it says this. If it does, your creditors will need to have a good reason for not agreeing to the change.

Next steps

Other useful information

There is a voluntary code of practice, called the IVA Protocol, which all insolvency practitioners and most creditors have signed up to. The protocol makes sure the processes involved in setting up and managing an IVA are clear and fair. It also sets out the terms and conditions all parties must follow.

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