How much does an IVA cost?

There are two main fees: one for setting the IVA up and one for running it. Both are taken out of the money you pay in, before your creditors get anything, so the real cost is that less of your money reaches your debts, especially in the first year or two.

What fees are there in an IVA?

gov.uk describes “a set up fee” and “a handling fee each time you make a payment”. In practice you will see these names:

The £15 registration fee is the only fee for a standard IVA that is set by law. There is no court fee for a normal IVA. Everything else is set by the insolvency practitioner (IP) and shown in your proposal, which must state the amount proposed for the nominee’s fees and expenses and how the supervisor’s fees will be worked out.

How much will you pay in fees?

There is no cap on IVA fees in law or in the IVA Protocol. IPs must charge fees that are fair and reasonable under their professional rules (Statement of Insolvency Practice 9), and your creditors see the fees before they vote.

Citizens Advice says IVA fees are around £5,000 on average. We could find no official average published by the Insolvency Service. Be cautious about precise figures you see elsewhere, such as fixed percentages or “typical” nominee fees: none of them is a rule, and your own proposal is the only figure that counts.

Under the IVA Protocol 2025, your proposal has to show how your payments will be split between the IP’s fees and your creditors, with a year-by-year schedule of when each is expected to be paid. Read that schedule before you sign.

Why do your early payments mostly go on fees?

The key facts document for protocol IVAs puts it plainly: “Typically, your first monthly payments will cover more of the fee than the debts you owe.”

Here is how that might look. The figures are hypothetical and round, and every IVA’s schedule is different.

In this example, someone paying £200 a month for five years pays £12,000, of which £5,000 goes on fees. In the first year, two thirds of what they pay goes on fees.

This matters most if the IVA fails early. According to the Insolvency Service, 6.0% of IVAs registered in 2024 were terminated within a year, and 21.0% of those registered in 2022 were terminated within three years. If yours ends in year one or two, most of what you paid will have gone on fees, your debts will have barely moved, and creditors can add back the interest and charges that were frozen.

Do you pay fees if the IVA is rejected or cancelled?

• If creditors reject your proposal: Citizens Advice says you will still need to pay the fees you owe the IP, which can usually be added to your existing debts.
• If you cancel once the IVA has started: the key facts document says you will not get a refund of any money you have already paid.
• If the IVA fails: the fees already taken are not returned.

How does the cost compare with other options?

Cost is only one factor, and the cheapest option is not automatically the right one. But it is worth knowing.

Each works very differently, so compare them properly in IVA or debt management plan? and IVA or bankruptcy?.

Questions to ask about fees before you sign

• What are the nominee fee, the supervisor fee and the expenses, in pounds, and what is the total?
• When will my creditors receive their first payment?
• If the proposal is rejected, or I withdraw, what will I owe you?
• Do the fees change if the IVA is extended, reduced or ends early?
• Who referred me to you, and were they paid? The IVA Protocol requires the referrer to be named in your proposal, and since 2 October 2023 the FCA has banned debt packagers from receiving referral fees from debt solution providers.
• Are any insurance products or other services included in my budget? Under the Protocol, IPs should not sell you insurance and must disclose any products they have introduced that appear in your budget.

Warning signs

Our guide on how to choose an IVA provider covers other red flags.

What to do next

1. Before paying anyone anything, get free, impartial advice from MoneyHelper, StepChange, Citizens Advice or National Debtline. They charge nothing and can set up most other debt solutions for you. See where to get free debt advice.
2. If you are considering an IVA, ask at least two IPs for a written estimate of the total fees and a copy of the fee and dividend schedule.
3. Weigh the fees against the benefits in our pros and cons of an IVA, and see the rest of our guides on the IVAs explained page.