Hiding money from IVA – What you need to know

Author Name MIchael Weaver Article date April 10, 2022

Are you in the process of setting up an IVA? Or maybe you’re considering one and are wondering if it’s right for you. An IVA, or individual voluntary arrangement, could be the ideal debt solution for you if you’re struggling to pay off your unsecured debts, but it will only work if you are fully committed to it.

The idea of an IVA is to pay off your debts in monthly payments. IVA providers expect debtors to pay as much as possible towards the debt, so hiding money from IVAs can result in the arrangement failing.

In this guide, we’ll look at hiding money from IVA agreements and whether it’s even possible. We’ll also go through whether the IVA company will be able to see your bank accounts and the consequences of failing to declare your assets before you begin the arrangement.

For more information on hiding money and assets from IVAs, be sure to read along!


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Is It Possible To Hide Money At The Start Of An IVA?

The way an IVA is set up makes it very difficult for you to hide money from the arrangement. Every source of earnings or income will have been declared as you begin the IVA, and any leftover funds will go towards the IVA payments; otherwise, you risk breaching the agreement.

Once the IVA starts, you’ll be entering into a legally binding agreement with the creditors that will allow you to pay off your debts through monthly payments that are affordable for you. In exchange, the creditors will agree to write off any remaining debt once the payment term is over.

When your Insolvency Practitioner starts drafting up your IVA proposal, the monthly payments will be based on what you can comfortably afford. They will take into account every source of money you have, from your monthly income and living costs to extra earnings, bonuses, and even your savings.

If you’re planning to hide money from your insolvency practitioner, you may be at risk of serious consequences. The nature of your financial situation will be seen on bank statements and payslips that you’ll have to hand over to your practitioner, meaning you could easily get caught.

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What Happens If Your Circumstances Change Whilst In An IVA?

Coming into money

Financial and personal circumstances can change, and given that an IVA can last up to 6 years, it’s very common for people’s income to increase during the arrangement. Although it doesn’t happen for everyone, coming into a large sum of money is quite common.

These windfalls, such as a lottery win or an inheritance, are naturally unexpected, so you may be wondering if you’ll be obligated to pay it towards the IVA. If you’ve received a lump sum, check whether your IVA includes a windfall clause.

If it does, any windfalls you receive will have to be paid into the IVA. If the windfall amount is more than your debt, you’ll be expected to pay off the IVA early as well as paying the Insolvency Practitioner fees. However, if the amount you receive is under £500, you’ll be able to keep the money.

Increase in earnings

If your earnings increase during your IVA, you must contact your IVA provider straight away and fill out a change of circumstances review. By completing this review, your provider will be able to check if your monthly payments should increase.

However, not all pay rises will mean your monthly repayments should change, for example, if your living costs have also increased. But failing to notify your provider of any pay rises or increases could put the success of your IVA in jeopardy.

You may also receive a commission, overtime, or bonuses. Unlike pay rises, these extra sources of income are considered unpredictable income. IVA terms typically allow you a 10% leeway on the allowed income. If you go over the 10%, any extra money would need to be put towards the IVA.

If you receive money, it’s always better to put it towards your IVA as soon as possible. Your agreement is there to help you rid your life of debt, and risking it being terminated by failing to declare additional income isn’t worth the risk.

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Our trained advisors are here to help, so if you think an IVA proposal is one of the best debt solutions for you, don’t hesitate to call us on 0800 464 7235 to speak to one of our trained debt advisors or click below to see if you qualify…

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Will An IVA Provider Be Able To See Your Bank Account?

During the IVA application process, you’ll have to go through a very thorough affordability check that will involve bank statements, payslips, bank accounts, and other financial details. This information will allow your insolvency practitioner to draw up an affordable debt management plan.

This affordability check means your IVA provider and Insolvency Practitioner will have a very good idea of how much money you earn, as well as your living expenses such as food, council tax, and rent or mortgage.

Although the IVA provider may not have direct access to your bank accounts, they can find out if you attempt to hide money from the agreement.

They’re entitled to check your account to find out your financial status, and if they discover hidden funds, you could face very serious repercussions. Not only that, but you’ll end up losing the money you tried to hide anyway.

Consequences Of Hiding Money From An Individual Voluntary Arrangement

IVA failure

If you’ve been caught trying to hide money or assets from your IVA agreement that could have been used to pay some or all of your debts off, the most likely thing to happen is the failure of your IVA.

If you don’t declare money, you’ll be in breach of your agreement, and it may be terminated. If your IVA fails, you’ll be sent a letter of termination and a report by your Insolvency Practitioner. This failure report will outline the details of your failed agreement and why it was terminated.

Once your IVA fails, your arrangement will be over, which means you won’t continue making the repayments to your Insolvency Practitioner or IVA provider. But, the remaining debt you owe will still stand.

You will still owe money included in the IVA to your creditors, and any further repayments will be your responsibility if you want to avoid being made bankrupt.


Because it’s a legally binding agreement, an IVA protects you from being harassed for payment by your creditors. If your IVA fails, you’ll no longer have that protection.

Your creditors will be allowed to start contacting you again, and they’ll be able to make you bankrupt immediately because you were in breach of the agreement.

Usually, your creditors would be obligated to send you a warning known as a statutory demand. But in the case of a failed IVA, they don’t need to do this.

Your Insolvency Practitioner will also have the power to deem you bankrupt. Although bankruptcy may be a good option if you aren’t a homeowner and have a low income, risks are involved.

If you are a homeowner, being made bankrupt means you risk losing your property, so it’s strongly recommended that you don’t attempt to hide money or do anything else to risk your IVA failing.

Court action

Like other legally binding agreements, breaching your Individual Voluntary Arrangement could mean you face court action. Not only is hiding assets or money considered a breach of contract, but it’s also fraud.

Although it’s not for certain, your creditors or IVA provider will likely take you to court. Hiding funds from the IVA could even have you sent to jail, depending on how serious the charges are.

This is why you should never hide money from your agreement. If you’ve started an IVA and you receive an unexpected sum of money, notify your IP immediately.

That money can be used to help pay off your debts or maybe pay the IVA off early, allowing you to move towards a life free from financial troubles.

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Get In Touch With IVA Helpline For Further IVA And Debt Advice

If you’re having financial difficulties and you need debt advice, don’t hesitate to call our expert, friendly team on 0800 464 7235. Our trained experts will be able to advise you as to whether an IVA is the best debt solution for you or not.

Our experts will provide helpful advice in a completely non-judgmental and empathetic environment, no matter your financial or personal circumstances. For more information, call our money advice service today to find out how we can help you to be free from debt for good.

Frequently asked questions

  • Can I leave any debts out of an IVA?

    If you decide to enter into an IVA, you’ll need to include every unsecured debt that you currently have. This includes things such as credit card arrears, county court judgments (CCJs), and personal loans.

    Usually, you won’t be allowed to leave any unsecured debts out, and if you attempt to, you may put the success of your agreement at risk, or it may not be approved at all. You’re unlikely to have any spare funds to pay off the debts that weren’t included because it will all go towards your IVA.

    With that said, there are certain circumstances where you may be able to leave debt out of the agreement. For example, if you need to take out a credit card to pay for business costs, or if you owe money to your employer, including that would put your employment contract at risk.

    If you plan to leave any debts out of your IVA, it must be made clear in the proposal as well as your reasons for doing so.

  • Can I get a bank account if I have an IVA?

    If you’re currently going through an IVA, you may find it a bit harder to open an account. This is because banks will usually reject you if you have a bad credit history.

    Having a savings account during your agreement is allowed. In fact, it will probably be a necessity as you’ll need to have sufficient funds to pay for more expensive costs such as your car MOT or repairs.

    After you’ve been adding to your savings for a while, you may find that you’ve accumulated a reasonable sum of money, and you may be able to use this amount to settle your agreement early.

  • Is it safe to hide money from an IVA?

    No, it’s never safe or a good idea to hide funds from an IVA. This type of agreement is a chance to pay off your debt and move on with your life. Hiding money or assets will only put that at risk, making things more difficult and stressful for you.

    You’ll be required to complete regular reviews as part of the IVA. This means that your IVA provider will always have a good idea of your finances, and they will find any extra money you come into whether you tell them or not.

    Ultimately, it is never worth doing anything to risk your IVA failing. Being honest about your finances and any windfalls you receive is the best policy. This will ensure your agreement is successful so you can pay off and clear your remaining debt.

  • Is an IVA a good debt solution?

    Going through debt and dealing with a single creditor is stressful, let alone dealing with 2 or more. An IVA may be a perfect solution if you’re struggling to pay off your debt and you’re finding it too much having multiple creditors.

    If you’re having serious financial troubles and you don’t think you’ll be able to repay all of your debts, don’t panic. Our team of experts can discuss your options with you, provide valuable debt advice, and help you decide whether an IVA is the best solution for you.

    We believe in treating each customer as an individual and with empathy. We understand that anyone can experience financial troubles, so don’t delay in contacting us if you need debt advice.

    For an initial consultation, be sure to call IVA Helpline today on 0800 464 7235 and start moving towards a life without debt.

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