| If you are currently in an IVA (Individual | | | | agree that your IVA is varied so that the tax |
| Voluntary Arrangement) and you receive | | | | debt can be included or the amount you pay each |
| notification from HMRC that you have to repay | | | | month can be reduced to compensate for the |
| tax arrears, this could mean that you will struggle | | | | increased tax you are paying. |
| to make your IVA payments. We consider what | | | | Generally your creditors will agree to a variation |
| your options are. | | | | of your IVA if necessary as the change is not |
| Over the past two weeks, HM Revenue and | | | | your fault. |
| Customs have announced that they have made | | | | I am not in an IVA currently |
| mistakes when calculating the tax payments of | | | | If you are not already in an IVA but are struggling |
| millions of people. As a result, over 1.5 million | | | | with your debts, a letter informing you that you |
| people now owe money to the tax man. | | | | now have to repay tax arrears as well could be |
| If you are one of the unlucky ones and are told | | | | the last straw. |
| that you owe tax, on average the amount | | | | If this is the case, you should consider the |
| outstanding will be £1200. The tax office has | | | | possibility of starting an IVA. This solution could be |
| said that they plan to take this directly from your | | | | the answer to resolving your debt problems once |
| wages next year at the rate of c£100 a month. | | | | and for all. |
| Losing this amount of money from your income | | | | You can include all of your unsecured debt in an |
| will make things extremely difficult if you are in an | | | | IVA including any tax arrears. The payments you |
| IVA and many people may face not being able to | | | | make are reduced down to a single affordable |
| keep up with their payments. | | | | payment each month and after paying for five |
| Add the debt to your IVA | | | | years any debt which is still outstanding is written |
| The first thing you must do if you receive a | | | | off. |
| letter from HMRC about tax arrears is inform | | | | Don't do nothing |
| your insolvency practitioner (IP). They should then | | | | If you are in an IVA and receive a letter saying |
| talk through two options with you. | | | | that you owe tax, you do not have to simply |
| If the tax you owe relates to a year before your | | | | struggle to save money from your budget and |
| IVA started, then the debt can often be simply | | | | continue making your payments. |
| included into your IVA without your monthly | | | | The extra tax debt can be included in your IVA |
| payments having to change. | | | | or your payments can be reduced to compensate |
| In fact any debt that you forgot about or did not | | | | you during the time when you are paying |
| know about at the time your IVA started can | | | | additional tax. |
| automatically be added to your IVA at a later | | | | Either way, handled properly, there is no reason |
| date. This is as long as the amount now paid to all | | | | for your IVA payments to be at risk or for you |
| creditors does not reduce by more than 10%. | | | | to suffer with trying to save extra money each |
| If your tax arrears are from a year after your | | | | month. |
| IVA started, these cannot automatically be | | | | The most important thing is to speak to your IP |
| included. Your IP will need to ask your creditors to | | | | straight away. |