{"id":3101,"date":"2014-01-14T14:46:08","date_gmt":"2014-01-14T14:46:08","guid":{"rendered":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/?p=3101"},"modified":"2019-03-08T12:36:00","modified_gmt":"2019-03-08T12:36:00","slug":"redundancy-payment-in-an-iva","status":"publish","type":"post","link":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/redundancy-payment-in-an-iva\/","title":{"rendered":"Redundancy Payment in an IVA"},"content":{"rendered":"\n

If you are in an <\/a>IVA<\/a><\/strong> making monthly contributions of your disposable income and you are unfortunately made redundant<\/strong>, you may receive a redundancy lump sum.<\/p>\n\n\n\n\n\n\n\n

In the first instance you should immediately inform your IP who is supervising your IVA of this serious change in your circumstances. Your supervisor is obliged to keep your creditors informed and will advise you what to do. <\/p>\n\n\n\n

\"Paying<\/figure><\/div>\n\n\n\n

Any redundancy lump sum is a windfall<\/strong> and the terms of your IVA proposal<\/strong>\n will spell out how such a windfall is to be treated. You will normally \nbe required to contribute the full amount of any windfall into your IVA.\n However, given that this is a redundancy payment, your supervisor \nshould be able to convene a Meeting of Creditors to determine how much \nof it (if any) you will be required to pay into the IVA. Your supervisor\n will quickly seek to determine the extent of the changes in your \ncircumstances, particularly your loss of income. You will apply for any \nbenefits to which you may be entitled following the loss of your \nemployment. Some of these benefits may be means tested and may be \nreduced due to your having received a redundancy lump sum. Some benefits\n may kick in after a period of time. For example, after being unemployed\n for three months the benefits agency may begin to pay the interest on \nyour mortgage. If your mortgage is repayment rather than interest only, \nyou may be in default if you do not make the full repayments. You will \nbe expected to seek employment as soon as possible so as to restore your\n income. It may be necessary for you to learn new skills and obtain \nappropriate training first. Your age, qualifications, skills or \nexperience may be barriers to gaining new employment.<\/p>\n\n\n\n

Your supervisor will quickly seek to determine the extent of the changes in your circumstances, particularly your loss of income. You will apply for any benefits to which you may be entitled following the loss of your employment. Some of these benefits may be means tested and may be reduced due to your having received a redundancy lump sum. Some benefits may kick in after a period of time. For example, after being unemployed for three months the benefits agency may begin to pay the interest on your mortgage. If your mortgage is repayment rather than interest only, you may be in default if you do not make the full repayments. You will be expected to seek employment as soon as possible so as to restore your income. It may be necessary for you to learn new skills and obtain appropriate training first. Your age, qualifications, skills or experience may be barriers to gaining new employment.<\/p>\n\n\n\n

Your supervisor will take all these factors into account and prepare a\n new Income and Expenditure Statement for you. Your creditors may be \ninvited to consider a variation to your IVA, taking into account the \nredundancy lump sum, your reduced income and all of the new \ncircumstances in which you find yourself. The variation proposal may \nseek a reduction or a moratorium on your IVA contributions for a period \nof time, perhaps from three to six months, while you obtain training or \nseek or obtain employment. The variation proposal can also seek \ncreditors\u2019 permission for you to retain a portion of the lump sum to \ncover your normal living expenses for a limited period of say three \nmonths, taking into account any benefits you are entitled to during that\n period. If you are unlikely to be able to obtain employment, the \nvariation proposal may seek creditors\u2019 agreement to accept all or some \nof the redundancy lump sum in full and final settlement of your IVA, \neven where the dividend is lower than the estimated dividend in your \nIVA.<\/p>\n\n\n\n

In a nutshell then, a redundancy lump sum is a windfall and you will \nnot be allowed to keep any part of it without the express permission of \nyour creditors. However, inform your supervisor of your new \ncircumstances and it may be that it will lead to a happy ending for you \nas well as for your creditors.<\/p>\n","protected":false},"excerpt":{"rendered":"

If you receive a Redundancy Payment you should immediately inform your IP who is supervising your IVA.<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"none","_seopress_titles_title":"","_seopress_titles_desc":"","_seopress_robots_index":"","footnotes":""},"categories":[7],"tags":[],"class_list":["post-3101","post","type-post","status-publish","format-standard","hentry","category-iva-articles"],"_links":{"self":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/3101","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/comments?post=3101"}],"version-history":[{"count":6,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/3101\/revisions"}],"predecessor-version":[{"id":3558,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/3101\/revisions\/3558"}],"wp:attachment":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/media?parent=3101"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/categories?post=3101"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/tags?post=3101"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}