IVA can't conclude because of legal dispute over VAT ?

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Adam Davies

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Post by Adam Davies » Fri Nov 11, 2011 11:24 am
Hi

So are you closing cases Gareth or are they still on hold ?

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Andam Davies
 
 

Gareth

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Post by Gareth » Fri Nov 11, 2011 11:50 am
Hi Andy, they are currently on hold pending the refund from the Revenue. When these funds come in we will have to redistribute to creditors first before completing. If there are any exceptional cases were the client will suffer due to the delay in completion these would be looked at and a decision made by the IP on whether the completion could occur sooner.
Gareth Buckley
Varden Nuttall
www.vardennuttall.co.uk

Read our reviews here: http://www.iva.com/iva_companies/Varden_Nuttall.asp
 
 

Foggy

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Post by Foggy » Fri Nov 11, 2011 12:54 pm
Hi Gareth. As this will become a universal problem to IP's, can't some sort of compromise be reached, whereby the debtor is, at least formally absolved from most of the conditions of the IVA relating, for instance, to windfalls.

The concern of many, I imagine, is the (however unlikely) scenario of having finished paying and actually having completed THEIR obligations under the IVA, they win the lottery or come into an inheritance, which, if it were not for the delays caused by this VAT interference, they would have been able to keep, but are now going to lose.
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kazzafunk

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Post by kazzafunk » Fri Nov 11, 2011 12:56 pm
I agree with foggy. Surely it can't be right that one company is closing IVA's and another leaving them on hold? I would have a mega foot stamping paddy if I had completed 5 years and there was a hold up!!
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IVA completed 21/03/2012
 
 

Adam Davies

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Post by Adam Davies » Fri Nov 11, 2011 12:59 pm
Hi

Foggy hits the nail on the head

The worry is that someting happens to the debtor whilst the IVA is still active because of the VAT hold up.

I hope this issue is resolved quickly for all concerned

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Andam Davies
 
 

Gareth

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Post by Gareth » Fri Nov 11, 2011 1:27 pm
Hi Foggy,

Yes, it would be nice if that could happen. In fact I would prefer it if we could issue the completion certificate the day that the final payment is received. After all the client has fulfilled their obligation under the IVA.

Unfortunately we are not allowed to do this under the rules laid down in the Insolvency Act and we are not allowed to complete the IVA until all funds have been distributed. If we are aware that additional funds are to come into the arrangement (and HMRC have confirmed they will) I cannot see how we could close the IVA before those funds have been paid to creditors.

You are also quite right in what you say regarding a lottery win or inheritance. As long as the case has not been officially completed any windfall must be paid in for the benefit of creditors. This may seem very unfair and I agree. Unfortunately we are all being affected by the VAT ruling. Im still trying to work out why Paymex (another IVA company) brought this case in the first place because all I can see is a delay for clients and a lot of work for IP's in trying to sort out all of the VAT refunds.
Gareth Buckley
Varden Nuttall
www.vardennuttall.co.uk

Read our reviews here: http://www.iva.com/iva_companies/Varden_Nuttall.asp
 
 

kazzafunk

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Post by kazzafunk » Fri Nov 11, 2011 1:35 pm
Hi Gareth - how come some companies are closing IVA's and others cannot? I can't help but feel sorry for clients of VN what with the PPI issues and now this (not being negative towards your company but it does seem there's a different interpretation of the law between companies).
Kazza

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IVA completed 21/03/2012
 
 

Adam Davies

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Post by Adam Davies » Fri Nov 11, 2011 1:37 pm
Hi
I think some companies have benefitted financially from the change in VAT, hence the reason it was brought to the attention of HMRC in the first place.
If their fees included VAT then they must be due some hefty refunds ?

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Andam Davies
 
 

Gareth

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Post by Gareth » Fri Nov 11, 2011 1:58 pm
Hi Kazza,

I cannot really answer for other IVA companies but there was a lot of confusion initialy over whether the VAT would be refunded by HMRC or not. This is now very clear, they will be refunding VAT on active cases and so I cannot see how a case can be closed when an IP knows there is money to come into the case. Our advice has been that you cannot close an IVA when you are aware of additional funds to come in.

It would be interesting to find out what other IPs intend to do with the money that they receive from HMRC for cases they have closed since submitting their VAT claim to HMRC.
Gareth Buckley
Varden Nuttall
www.vardennuttall.co.uk

Read our reviews here: http://www.iva.com/iva_companies/Varden_Nuttall.asp
 
 

Gareth

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Post by Gareth » Fri Nov 11, 2011 2:03 pm
Hi Andy,

You could be right. Maybe they said our fee is £XXX including VAT which means when a refund comes in it will all go to them.

Based on protocol cases I think most companies will gain some benefit on Nominees fees but any VAT refunds on supervisors fees should be going to the creditors due to the standard Tix modifications.

In any case there is going to be a lot of work involved in sorting this mess out and I think the majority of clients and IP's would prefer it if this ruling never happened.
Gareth Buckley
Varden Nuttall
www.vardennuttall.co.uk

Read our reviews here: http://www.iva.com/iva_companies/Varden_Nuttall.asp
 
 

Adam Davies

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Post by Adam Davies » Fri Nov 11, 2011 2:16 pm
Hi

You may be right but I think Paymex are still smiling.

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Andam Davies
 
 

loopfish

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Post by loopfish » Mon Dec 05, 2011 2:43 pm
I paid off my IVA back in June. It's now December and my IVA has still not been completed.

I can assure that I am not smiling...
 
 

kazzafunk

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Post by kazzafunk » Mon Dec 05, 2011 3:14 pm
That is disgusting and not good enough in my opinion. Have they given you any indication as to how long this could take?
Kazza

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IVA completed 21/03/2012
 
 

plasticdaft

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Post by plasticdaft » Mon Dec 05, 2011 4:59 pm
This is pathetic and once again the person in the IVA paying for it all is getting humped!!

If the refund is only due to the IP's and then on to creditors as an extra then why cant cases be closed,certificate issued then when the refund comes through the IP can distribute it minus whatever extra fee they wish to charge.

If you have served the 5 or 6 year sentence of an IVA its horrific to think that things will be held up indefinately,and with HMRC on the case this will be a long drawn out process.

Given that everyone now knows what is VAT exempt can IP's not anticipate this claim by applying earlier than the iva end date?

Paul
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Continuing to rebuild our credit worthiness.
 
 

Broke of London

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Post by Broke of London » Tue Dec 06, 2011 12:29 am
"getting humped" - love it!!!!!! [:)][:)]

This is very unfair on the clients.
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