What Does an IVA Cost? Fees, Charges and What You Actually Pay
Published 23rd of September 2016·Updated 20 April 2026
Reviewed by: Reviewed for accuracy April 2026
An IVA (Individual Voluntary Arrangement) is not free, but you do not pay the fees upfront. The costs are built into your monthly repayments and taken by your insolvency practitioner (IP) before distributing the remainder to your creditors. Total IP fees typically average around £5,000 across the life of the arrangement, according to the Insolvency Service.
Short Summary
IVA fees are deducted from your monthly repayments. You do not need to find any additional money beyond your agreed monthly contribution.
There are two main fees: a nominee fee for setting up the IVA, and a supervisor fee for managing it throughout its duration.
Disbursement fees cover third-party costs such as insurance and registration with the Insolvency Service.
There are no set legal limits on what an IP can charge, so it is worth comparing providers and asking for a full fee breakdown before signing anything.
Do you pay for an initial IVA consultation?
Most reputable IVA providers, including those referred through StepChange or Citizens Advice, offer the initial consultation free of charge. If you approach an insolvency practitioner directly after being referred by a court, a fee of around £335 may apply. However, this amount is generally deducted from the court deposit rather than paid separately, so it should not result in an additional out-of-pocket cost.
Always confirm whether there is a charge before attending a consultation. Any firm that demands upfront payment before even assessing your situation is worth approaching with caution.
What is the IVA nominee fee?
The nominee fee is charged by your IP for preparing your IVA proposal and presenting it to your creditors. This involves gathering details of your income, debts, assets, and outgoings; drafting the formal proposal; and chairing the creditors' meeting (now typically conducted in writing rather than in person). The nominee fee is a one-off charge paid from your early repayments.
What is the IVA supervisor fee?
The supervisor fee covers the ongoing management of your IVA throughout its five to six year duration. Your IP supervises all repayments, conducts annual reviews of your income and expenditure, liaises with creditors, and issues your completion certificate at the end. The supervisor fee is taken as a percentage of each monthly payment throughout the arrangement.
What are IVA disbursement fees?
Disbursement fees cover costs incurred by third parties during the IVA. Common disbursements include:
- Registration of the IVA on the Insolvency Register
- Bond insurance (required by IPs to protect against misconduct)
- IT and case management system fees
- Property valuation costs if you own a home
- Land registry fees if remortgaging is required in the final year
These are charged in addition to the nominee and supervisor fees but should be itemised clearly in your IVA proposal. Ask your IP for a complete schedule of expected disbursements before you agree to proceed.
How IVA fees break down in practice
The table below illustrates how fees work in a typical IVA with monthly repayments of £200 over 60 months.
| Component | Approximate amount |
|---|---|
| Total repayments (60 x £200) | £12,000 |
| Nominee fee | £1,000-£1,500 |
| Supervisor fee | £2,500-£3,500 |
| Disbursement fees | £500-£1,000 |
| Total IP fees (approximate) | £4,000-£6,000 |
| Amount reaching creditors | £6,000-£8,000 |
Figures are illustrative. Your actual split will depend on your IP's fee structure and your specific circumstances.
Are there limits on what IPs can charge?
The Insolvency Service does not set a statutory maximum for IVA fees. However, IPs are regulated by one of several recognised professional bodies, including the Insolvency Practitioners Association (IPA), the Institute of Chartered Accountants in England and Wales (ICAEW), and the Association of Chartered Certified Accountants (ACCA). These bodies require IPs to act in good faith and charge reasonable fees. If you believe fees are excessive, you can raise a complaint with the relevant regulatory body.
Creditors also have an interest in keeping fees reasonable, since higher fees mean less money reaches them. In practice, creditors can challenge fee levels at the initial meeting, which acts as an informal check.
Can you get a free IVA?
No IVA is truly free; fees are always charged. However, non-profit debt charities such as StepChange have commercial arms that offer IVAs, and the overall cost may be lower than using a fee-charging commercial IVA firm. The key is to compare the total repayable amount and ask for the full fee schedule from any provider before agreeing to proceed.
FAQ
Who pays IVA fees - me or my creditors?
In practice, both. The fees come from your monthly repayments, which means creditors receive a smaller proportion of what you pay. You do not pay the fees on top of your monthly contribution; they are deducted before the remainder is distributed to creditors.
What happens to IVA fees if the arrangement fails?
If your IVA fails, your IP is entitled to claim fees for the work already carried out. Any remaining funds in the IVA account are typically returned to creditors rather than to you. Your debts revert to their original balances, minus any payments already made. This is why maintaining your monthly payments is critical.
Can I negotiate IVA fees?
Not directly. Your IP sets their fee schedule and creditors approve it as part of the IVA proposal. However, you can shop around between different IP firms and compare their proposed fee structures before committing. Always ask for a full written fee schedule, not just a headline monthly payment figure.
Are IVA fees tax deductible?
No. IVA fees are a personal debt repayment cost and are not tax deductible for individuals. Self-employed individuals should confirm with their accountant whether any element of the arrangement relates to business debt, as the treatment may differ in that context.
Is it cheaper to go bankrupt than to enter an IVA?
Bankruptcy has a fixed application fee of £680, payable to the Insolvency Service. IVA fees are significantly higher in total, but are spread over five to six years. The more relevant comparison is whether bankruptcy or an IVA better suits your circumstances, not just which is cheaper. A free debt adviser at StepChange or Citizens Advice can help you weigh both options.