I am in an IVA but can I work for myself?
There are no restrictions on becoming a 'Sole Trader' whilst you're in an IVA.
But, the truth is, financial stability is the bedrock of all IVAs and making changes to your income could cause you problems.
So if you're considering becoming self employment midway through your IVA, you'd be well advised to prepare well.
Preparation Is Key
Firstly, make sure you're being realistic with your expectations.
Also, make sure you're familiar with the responsibilities related to running your own business, especially those related to managing your tax obligations.
Do as much research as possible on the market place your business will be operating in. Making sure you understand it thoroughly could save you from making expensive mistakes.
Make accurate cash flow projections, and familiarise yourself with the levels of turnover you'll initially need to generate to maintain your current income level.
And finally, you should keep your Supervisor informed of the expected changes to your income, as communication is very important and it won't hurt for them to know.
Potential payment problems
Probably the most important thing to remember is that your IVA contributions are sacrosanct.
But, if you do hit payment problems you're best advised to speak to your IP at the first available opportunity.
They have some options available to assist you with any temporary issues, but if you can't maintain your contributions in the longterm, your IVA will be in danger of failing.
No credit available
Starting a business can be challenging at the best of times, but another concern you'll have will relate to obtaining credit.
You'll need permission from your Supervisor if you wish to open any lines of credit with suppliers or trade outlets, and the terms and conditions of your IVA forbid you from seeking finance.
Which means your business will need to be self-financing, or have a chance to grow organically.
Becoming successful
If you do take the plunge, start your own business which becomes a success, your Supervisor will need to be kept abreast of your income.
IVA contributions are based on affordability so, if your income increases as a result of your success, there's a possibility that your IVA contributions will be increased accordingly.
Understanding your obligations under the terms of your IVA will help you ensure you keep your IVA on track.
For more information on this point you should speak to your Supervisor.
