The monthly payment in an IVA starts at £70 and is typically between £100 and £300, calculated against your real income and essential outgoings using the Standard Financial Statement — the same affordability tool used by every UK lender, debt charity and Insolvency Practitioner. There is no fixed amount; the right figure for you is whatever is left after essentials are covered.
This page covers how the monthly payment is set, what counts as an essential, what changes the figure mid-term, and how it compares against the alternatives.
How the monthly figure is calculated#
The Insolvency Practitioner asks for a full picture of your income and outgoings. Income includes:
- Salary or wages (after tax and NI)
- Self-employment net income (after business expenses and tax)
- Pensions
- Universal Credit and other benefits
- Tax credits, child benefit, child maintenance
- Any other regular income
Outgoings are split into essentials and non-essentials:
Essentials that are accepted in the Standard Financial Statement:
- Rent or mortgage payments and ground rent
- Council tax
- Utilities (gas, electricity, water)
- Food and household basics
- Transport (work travel, school travel, MOT, insurance, fuel)
- Childcare and school costs
- Telephone and broadband (basic)
- Insurance (life, building, contents)
- Medical and prescription costs
- Personal costs (toiletries, haircuts) within set limits
Trigger figures — the SFS sets typical reasonable amounts for each category. If your spend in a category is above the trigger, you’ll need to explain why, but reasonable explanations are accepted.
The calculation is simply:
Monthly IVA payment = total monthly income − total essential outgoings
The result is the disposable income figure, and that’s the IVA payment.
Worked examples#
A two-person household with £2,400 net income#
- Net income (one earner): £2,400
- Rent: £900
- Council tax: £160
- Gas & electric: £170
- Water: £40
- Food & household: £450
- Transport: £220
- Phone, broadband, basic insurances: £140
- Childcare: £150
- Total essentials: £2,230
- Available for IVA: £170 a month
A single homeowner with £2,000 net income and a small mortgage#
- Net income: £2,000
- Mortgage: £620
- Council tax: £140
- Gas & electric: £140
- Water: £35
- Food & household: £290
- Transport: £200
- Phone, broadband, basic insurances: £130
- Total essentials: £1,555
- Available for IVA: £445 — usually capped to a sustainable figure around £250–£300, with the rest treated as a contingency
A self-employed sole trader with £1,800 net income#
- Net trading income (after tax/NI): £1,800
- Rent: £680
- Council tax: £130
- Gas & electric: £130
- Water: £35
- Food & household: £350
- Transport: £180
- Phone, broadband, basic insurances: £120
- Total essentials: £1,625
- Available for IVA: £175 a month
Why £70 is the standard floor#
Below £70, the cost of administering the IVA — the IP’s nominee fee, supervisor fee and disbursements — leaves so little left over for creditors that the proposal becomes uneconomic. Most providers will not draft a proposal for less than £70 a month.
If your disposable income is below £70 per month, an IVA is usually the wrong product. The right options are:
- Debt Relief Order (DRO) if total debts are under £50,000, you have very little spare income and no significant assets — debt is written off after 12 months
- Bankruptcy if no realistic monthly contribution is possible
- Breathing Space if you need a temporary 60-day pause to reorganise
What can change the monthly figure mid-IVA#
The agreed payment is reviewed every year, and changes can be agreed at any time:
- Income drops (redundancy, hours cut, illness). The payment is reduced. Up to 9 months of payment breaks are permitted under the 2025 IVA Protocol.
- Income rises (new job, pay rise). Typically 50% of the increase goes towards the IVA in the form of an uplifted payment.
- Essentials change (rent increase, new childcare cost). The payment is reduced to keep the SFS balanced.
- Windfalls. Inheritances, redundancy lump sums, PPI refunds and similar windfalls above £500 are paid into the IVA on top of the regular monthly payment.
The IP must apply the SFS at every review, so the figure is always grounded in real numbers, not guesses.
How the monthly cost compares with alternatives#
| Solution | Typical monthly cost | Term | Total paid |
|---|---|---|---|
| IVA | £70–£300 | 5–6 years | £4,200–£21,600 |
| DMP (Debt Management Plan) | Set by you, often higher | Until full repayment (open-ended) | Full debt repaid |
| DRO | Nothing while in the DRO | 12 months | Nothing — debt written off |
| Bankruptcy | Income Payment Agreement if any spare income | Usually 12 months active | IPA payments only |
The IVA route is often the best fit when there is some monthly disposable income but not enough to clear the debt in a reasonable timeframe.
Read next#
- How much does an IVA cost? — full breakdown including IP fees and write-off percentages
- Is an IVA worth it? — wider trade-offs
- How long does an IVA take to pay off? — term length explained
- How do I apply for an IVA? — the application process
Related questions#
- Can I get a loan to pay off IVA?
- Can I get a mobile phone contract with an IVA?
- Can I get monthly car insurance with an IVA?
- Can I keep an IVA secret?
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