What is the Scottish version of an IVA?
If you are a resident in Scotland the Protected Trust Deed is a solution that could help you write off unaffordable debt and enjoy life after debt.
What’s the Difference Between an IVA and a Trust Deed?
The main differences between an IVA and Trust Deed are that the Individual Voluntary Arrangement is an English, Northern Irish and Welsh formal debt solution. A Trust Deed is a formal debt solution for Scottish residents only.
An IVA can only be applied for by English, Northern Irish and Welsh residents. Therefore Trust Deeds are only available for Scottish Residents (or have lived in Scotland in the last 12 months).
In an IVA you must have minimum unsecured debts of £6,000* whereas in a Trust Deed the minimum total debt level of over £5,000.
The duration of the debt management process is different in that an IVA typically lasts for 60 months whereas a Trust Deed typically lasts for 48 months.
In order to qualify for a Trust Deed – you must live in Scotland or have lived in Scotland in the last 12 months. You may also qualify if you have a place of business in Scotland.
It isn’t unusual for a person living and working in England, Wales or Northern Ireland to enter a Trust Deed, or complete their Trust Deed term while resident in one of these countries as long as they met the above criteria regarding residency in Scotland.
Likewise, It’s not unheard of for British ex-pats to move abroad while in an IVA or Trust Deed and continue with their repayments while living there – it’s fairly normal for people from Scotland to continue with their Trust Deed while living in another country of the United Kingdom, or any country overseas.
Sometimes you may read about a Scottish IVA online, or you may have received an email, or seen an ad on social media talking about individual voluntary arrangements, invited you to apply for an IVA. This is often an oversight from organisations based in England.
Occasionally companies that are based Overseas, or in England acquire ‘UK data’ to cold-call by salespeople who are not qualified to give advice which further adds to the confusion.
Trust Deed Scotland® have helped over 25,000 and specialises in Scottish debt solutions and our experienced debt advisers are experienced in advising on not only Trust Deeds but other Scottish debt solutions which include the Debt Arrangement Scheme.
There are other subtle differences between IVAs and Trust Deeds and there are other differences in what’s known as a Debt Relief Order for example, with our Scottish equivalent’ known as the Minimal Asset Process.
What’re the similarities between an IVA and a Trust Deed?
Whilst there are differences between an Individual Voluntary Arrangement and Protected Trust Deed, there are also many similarities between an IVA and a Trust Deed.
Most importantly, both solutions exist to help people in the UK reduce their debts down to an affordable level, and take back control of their personal finances.
- You should owe money to two or more creditors
- Your contributions are based on your ability to pay and you need to have a monthly income
- Only unsecured debts can be part of the agreement
- Interest and charges on all included debts are typically frozen
- Any unpaid debts at the end of the arrangement term are written off, allowing you to look forward to life after debt
- Both IVAs and Trust Deeds are a good alternative to bankruptcy/sequestration
- Neither An IVA or a Trust Deed impact on your ability to hold public office or be a company director
- All windfalls including inheritances, bonuses, and lottery wins in excess of £500 must be declared
- IVAs and Trust Deeds are recorded on the Gazette register
- Your credit record will be affected by your IVA or Trust Deed and they will appear on your credit file
Both solutions offer Self-Employment help to individuals with debt.
London, Belfast and Edinburgh Gazettes
Creditors can access details of your insolvency through the equivalent regional Gazette.
This means it’s unlikely that your friends, family or neighbours would find out about your finances in this way. The exception to this would be if there has been a high level of public concern or complaint about your financial conduct.
An IVA is listed in the London or Belfast Gazette and the Trust Deed is listed in the Edinburgh Gazette. In Wales, there is no Cardiff Gazette, so therefore these are listed in the London Gazette.
How to Apply for a Trust Deed Today
When considering whether to apply for a Trust Deed or any other type of debt solution, It’s only natural for people to ask questions like
You may have already spent countless hours researching debt solution options, or you may not have had the confidence to explore any options yet as for many people, taking the first step of asking for help can be too difficult to overcome.
In any situation where you are faced with unaffordable debts, we always advise that you seek tailored debt advice and at Trust Deed Scotland – we always have your best interest at heart. After speaking to our debt advisers – we’ll provide you with a personalised illustration of all options open to you and their advantages and disadvantages.
Our highly-experienced debt advisers offer non-judgemental, balanced advice.
They’ll help you to understand that it’s not necessarily a one-size-fits-all solution that suits your needs, but that the way out of financial difficulties for you depends on what best suits your needs and affordability.
*To qualify for an IVA officially, there is no minimum debt level. The reason why £6,000 is given here as a guideline is that this is the most common amount that Insolvency Practitioners will work with when checking to see if a customer can qualify for an IVA. You may find when you have spoken to an Insolvency Practitioner that if your unaffordable debt level falls below £6,000 that they will decide on a case by case basis as to whether they will put your IVA application forward, dependent on the amount that you can afford to repay and the amount of work involved for them.