IVA income, borrowing and early-completion rules

Your approved Individual Voluntary Arrangement (IVA) and any agreed changes set the rules you must follow. Income allowances, borrowing limits and early-completion options are provisions of the arrangement, not loopholes.

This guide explains common provisions in the 2025 IVA Protocol for England and Wales. Older or bespoke IVAs, and arrangements in Northern Ireland, may have different terms. Scotland has different debt solutions. Check your own proposal and speak to your IVA supervisor before borrowing or changing payments.

Updated 18 October 2026.

What does an IVA require?

An IVA is a formal agreement with creditors, supervised by a licensed insolvency practitioner. Your approved terms set out your contributions, the debts included, fees and how changes to your income or assets will be handled.

You must provide accurate information and report changes as required by your terms. Your budget should allow for agreed living costs. Do not assume that all savings are prohibited or that you can keep every windfall: check how your IVA deals with savings, additional income, gifts and inheritances.

Extra income: check the allowance in your terms

Under the 2025 Protocol standard terms, overtime, bonuses or commission above 10% of normal take-home pay must be reported to the supervisor within 14 days of receipt. Half of the excess above that threshold is payable within 14 days of disclosure.

This is not a general right to keep every increase in income. A permanent pay rise is not automatically covered by this allowance. Report changes promptly and ask your supervisor how your own terms apply before spending the extra money.

Borrowing during an IVA

The 2025 standard terms require prior written approval from the supervisor for credit over £500, with specified exceptions for budgeted contractual payments. Your own IVA may contain different or additional restrictions.

This is not a general entitlement to borrow £500 or a recommendation to take on more debt. A lender may decline an application, and new repayments could make your existing commitments harder to meet. Check your IVA and discuss proposed borrowing with your supervisor first.

How can an IVA finish early?

A full-and-final settlement offer is one possible route, subject to creditor agreement. It is not the only way an IVA can reach an early conclusion.

Under the 2025 standard terms, paying the amounts owed to creditors and the arrangement’s costs and fees in full can also bring the IVA to an early conclusion without further creditor approval.

If financial difficulties mean a breach is likely to lead to termination, the 2025 Protocol says the supervisor should consider whether to propose a creditor-approved settlement with no further payments. This may mean treating payments already made as a settlement. It is not an automatic entitlement.

The available route depends on your circumstances, the approved terms and any necessary creditor decision. Speak to your supervisor before making an offer. A windfall may already have to be paid into the IVA under its terms; receiving one does not automatically settle the arrangement.

If your payments become unaffordable

Contact your supervisor promptly. Depending on your terms and circumstances, they may be able to agree reduced contributions or a payment break, or ask creditors to approve a change. Some changes can extend the arrangement. None is guaranteed.

Stopping payments does not itself write off debt. If an IVA fails, creditors may be able to pursue outstanding balances and, in some circumstances, bankruptcy may follow. Ask your supervisor to explain the consequences and available options before you change or stop payments.

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Can the remaining debt be written off?

On successful completion, debts included in the IVA are dealt with according to its terms. A creditor-approved settlement may allow some remaining debt to be written off. Do not assume that every debt is included or that making an offer guarantees a write-off.

Be open with your supervisor about your income, assets and changes in circumstances. Hiding money or giving inaccurate information can breach the arrangement and have serious consequences.

Where to get help

For questions about an existing IVA, contact the supervisor named in your arrangement. For free, impartial help finding debt advice, use the MoneyHelper debt advice locator. Thrifty Family publishes general information and does not provide personal debt advice or recommend a debt solution.

Sources and scope

The provisions described above come from the 2025 IVA Protocol, including paragraph 35, and its standard terms and conditions. These are not universal statutory entitlements. Your approved IVA and any variations determine which terms apply.