50/50 clause

[Hovish]

Hi Ang,

are you saying that you do not have to pay 50% of your hubbys overtime. Or are you saying that some people just do not get the chance of overtime anyway so they have no chance of any extra money.
It really is confussing and not really fiar as you say it should really be a set rule although it is disheartening when you work really hard and have to hand half over, but also we did get ourselves in a mess so we have to suffer the consequences.

[aguise]

No Hovish we pay the 50% of overtime each month and the other 50% we keep. We dont mind at all as before the iva hubby still did the overtime and it ALL went on the debts so st least now we benefit the 50%. It has helped with a lot of things . Read my blog. Yes I was saying some dont get overtime and have all their pay increase taken as well, so it isnt fair at all for them.

Ang

[OPTIMIST12]

I just like to try and look on the bright side - keeping 50% of Overtime is better than keeping 0%.!!!!!!

Agree with Ang too - it would be nice if there was a more level playing field in respect of smaller pay increases.

[ianmillington]

I agree this aspect of IVAs is in something of a mess. The reason for this is, I believe, because an IVA proposal is a contract drafted by a non-lawyer. Worse, it then proceeds to get modified in varying degrees by other non-lawyers. The nature of the modifications depend entirely on which non-lawyer has voted which itself depends upon the makeup of the creditors list, so it's hardly surprising we have a hotch-potch.


To Optimist 12 - Isn't there a catch-all in your proposal which states "or any other additional payments received over and above that already provided for in my income calculation as detailed in paragraph....." [/i. However, to further illustrate the point of how unsatisfactory the situation is, my interpretation of this is that the 50% rule applies to the income only, without any reference to any additional expenses incurred (by the omission of any reference to expenditure). /b] /i]


I remain of the view that where the proposal merely provides for a review, but provides no formula, then it's at the discretion of the Supervisor.

This is crying out for a standard. In my opinion the most sensible thing I have seen is, ironically, the Grant Thornton modification. I have quoted it earlier but will repeat: "A full review of income and expenditure will be undertaken annually. This must include a copy of the Debtor's latest P60 together with payslips for the 3 months immediately prior to the review. Where net income has increased (including routine overtime) the Debtor shall increase monthly contributions by 50% of the net surplus (after taking into account costs of living).

That seems clear to me. What does evryone else think?

Ian

PS Sorry I appear to have messed up the italics[:D]

[Adam Davies]

Hi
Yes I'll vote for that one.

Like most aspects of an IVA it really is down to how your IP interprets it.Your creditors rely on the IP to admnistrate the IVA and won't ask too many questions about reviews etc.
It is so important to not only choose the right IP but one that you feel you will have a good relationship with.
My view is that in some of the larger organisations you will deal with a different person each year and they will do things by the book with no flexibility,whereas if you use a smaller practice you will always deal with your IP or a dedicated person and will be able to discuss points as and when you need to
Regards

[Hull_Tiger]

I agree completely. This is the problem with my IVA.
I don't really have any incentive to achieve more in my career for the next 5 years as every extra penny I earn will be passed over to my IVA. It's very frustrating knowing that all additonal income I could receive will be taken.
I can see the benefits of it in 5 years time, but many people would see that as a long time to wait.

[ianmillington]

Hi Shaun

I know you have said that he/she insists on 100p in the £. I also assume that you are up to date with your contributions?

If that's the case it may help if you politely enquire how a requirement to introduce 100% of any increase in pay can be defined as "reasonable" particularly given that in a Bankruptcy the maximum it would ever be is 70%.

Ian

[OPTIMIST12]

Hi Ian -

Yes - I do have a similar paragraph in my proposal to the one you quote. I must say though that I have no problem with the way my payments have been calculated. When I first started thinking about an IVA I assumed that I would be allocated a tough monthly "expenditure" budget and that everything else - from whatever source - would have to bee paid in 100% to the IVA. I was therefore very happy when I found out that I could keep 50% of my overtime and any bonus. My only expectation was that I would receive an increased expenditure allowance to cover any bills / costs going up and - from what I can gather - I will get this.

I have my first annual review due soon but - as I send in my payslip monthly with my "overtime" cheque - and sent in notification of my pay rise as soon as I got it - I am hoping I will not be in for any nasty surprises!!!!

[ianmillington]

If you have the term net income and reference to cost of living then you are in luck I think, particularly in view of the recently-announced utility increases.

Good Luck

ian

[Hull_Tiger]

Hi Ian,
Yes, I'm completely up to date.
Everything so far has been done over the phone with one of my IP's advisors. She basically said that as my I&E hasn't really moved (it's only £6 more than the original proposal) that all excess income should be paid into the IVA, as per the original proposal.
My wages have risen by £103 a month and they have suggested an increase from £448 to £545.
I'm about to send my current I&E in the post for them to view. As my first 'full' pay packet won't be until the end of February, I guess and can still push the issue for a bit longer.
A question for anyone 'in the know':
My January pay was about £118 short due to being on Basic Rate tax (waiting for P45 from previous employer). I can manage for this month by cutting back the shopping and contingency budgets, but when I get it back, will this be construed as a windfall? Will I get to keep it?

[Adam Davies]

Hi
You should get this back as your wages should be viewed as an average over the three months.
Regards

[ianmillington]

Hi Shaun

I define a windfall as an unexpected receipt. This can't be a windfall as it's merely repayment of an excessive deduction you have suffered the previous month.

ian

[MelanieGiles]

The following script is an extract from the new IVA protocol which is discretionary but most IPs are expected to adopt.

10.2 The IVA provider should ensure that they are provided with copies of payslips (or other supporting evidence) every 12 months. The supervisor is required to review the debtor’s income and expenditure once in every 12 months. The debtor will be required to increase his monthly contribution by 50% of any net surplus one month following such review. The supervisor will also be able to reduce the dividend by up to 15% in total relative to the original proposal (without referring back to creditors), to reflect changes in income and expenditure.

10.3 Where the individual has failed to disclose exceptional income, the term of the IVA may be extended by up to a maximum of 6 months to recover any sums due, without any modification being required.

That would seem to now settle this point once and for all - or at least for those of us who intend to embrace this protocol. This will be effective for IVAs proposed from 1 February 2008 onwards.

[Hull_Tiger]

That sounds exactly what is required. It's just a shame it can't be retrospectively applied to existing IVA's. [:p]
I'm tempted to mention this in my revised I&E I'm about to send to my IP to see if I can get anywhere. Sadly, I think I might be out of luck.