What is the Role of an Insolvency Practitioner in an IVA?
Published 20th of September 2016·Updated 27 April 2026
Reviewed by: Reviewed for accuracy April 2026
An insolvency practitioner (IP) is the licensed professional who sets up and manages your Individual Voluntary Arrangement from beginning to end. They assess your finances, draft the formal proposal sent to creditors, chair the creditors' meeting, and then supervise your monthly payments for the duration of the IVA, typically five or six years.
Short Summary
You cannot enter an IVA without a licensed insolvency practitioner. Only individuals licensed by a recognised body, such as the Insolvency Practitioners Association or the Institute of Chartered Accountants in England and Wales (ICAEW), can legally act as an IP.
The IP works on behalf of both you and your creditors. Their job is to reach a fair arrangement that gives creditors a realistic return while keeping your payments affordable.
IP fees are paid from your monthly IVA contributions, not charged separately on top. The fee structure must be disclosed to you before the IVA begins.
If you have a complaint about an IP, you can raise it with their licensing body or with the Insolvency Service.
How does an insolvency practitioner assess your finances?
The first meeting with an IP is an in-depth review of your financial situation. They will ask for evidence of your income, your essential monthly outgoings (rent or mortgage, council tax, energy bills, food, travel), your total debt and who you owe it to, and details of any assets such as property or savings. From this information, they calculate your disposable income: the amount left over each month after your essential costs, which becomes your IVA payment.
The IP also checks whether you meet the basic eligibility requirements: living in England, Wales or Northern Ireland, having at least £6,000 in unsecured debt, and owing money to two or more creditors.
What does the IVA proposal contain?
Once the IP has a complete picture of your finances, they draft the IVA proposal. This document is the formal offer sent to your creditors. It sets out how much you will pay each month, how long the IVA will run, what debts are included, and how any equity in your home will be treated. You review the draft before it is sent and can raise queries or request reasonable amendments.
The IP sends the final proposal to creditors approximately two weeks before the creditors' meeting, giving them time to review and submit their votes or any modifications they want to propose.
What happens at the creditors' meeting?
The IP chairs the Meeting of Creditors, which is now typically held virtually or by correspondence rather than in person. Creditors vote on whether to accept the proposal. The IVA is approved if creditors holding 75 per cent or more of your debt by value vote in favour. Once approved, it is legally binding on all creditors named in it, including any who voted against.
The IP uses their professional judgement during the meeting to negotiate with creditors and respond to any proposed modifications. Their ability to present your case credibly and negotiate realistic terms is a key part of the value they provide.
How does the IP supervise the IVA once it is running?
After approval, the IP becomes the supervisor of your IVA. Your single monthly payment goes to them, and they distribute it among your creditors according to the agreed terms. Their ongoing responsibilities include:
- Carrying out an annual review of your income and outgoings
- Adjusting your payments if your financial circumstances change significantly
- Assessing any windfall income (inheritance, bonuses) and determining whether you must contribute a portion to the IVA
- Arranging a valuation of your home if an equity release clause applies
- Ensuring creditors adhere to the terms of the IVA and do not contact you directly
- Issuing a completion certificate when you have fulfilled all the terms of the arrangement
What are IP fees and who pays them?
IP fees are governed by the Insolvency Act 1986 and must be disclosed to you before the IVA begins. They are deducted from your monthly payments rather than charged separately. Typical fees include a nominee fee (for setting up the IVA) and a supervisor's fee (for managing it over its term). Creditors receive what remains after fees are deducted.
You should receive a clear, itemised breakdown of fees before signing anything. If you are unsure whether a fee level is reasonable, free charities such as StepChange can provide a comparison.
How do I find a licensed insolvency practitioner?
You can search the register of licensed insolvency practitioners on the government's GOV.UK website. You can also seek a referral through free debt advice charities such as StepChange Debt Charity or Citizens Advice, who work with reputable IPs and do not charge for the referral.
Be cautious of cold-call IVA companies that approach you unsolicited. Always verify that any IP is licensed before sharing personal or financial information.
| Licensing body | Who they license |
|---|---|
| Insolvency Practitioners Association (IPA) | Specialist insolvency practitioners |
| ICAEW | Chartered accountants practising insolvency |
| ACCA | Chartered certified accountants |
| The Law Society | Solicitors practising insolvency |
FAQ
Can I choose my own insolvency practitioner?
Yes. You are free to approach any licensed IP. It is worth comparing two or three firms, particularly on their fee structures and communication style, before committing. Free debt charities can recommend reputable IPs if you are unsure where to start.
What happens if my IP company closes down?
If an IP firm closes while your IVA is active, a replacement supervisor must be appointed. The Insolvency Service oversees this process. Your IVA does not fail simply because your IP's firm closes; it continues under new supervision.
Can I change my insolvency practitioner once the IVA has started?
Changing IP during an IVA is possible but complex. It requires the consent of creditors and involves a handover of case records. It is not something to undertake without good reason. If you have a serious concern about your IP's conduct, raise it with their licensing body first.
Is the IP on my side or the creditors' side?
The IP has a duty to both you and your creditors. They must ensure the arrangement is fair to creditors while remaining affordable for you. They are not exclusively your advocate, but their interest in a successful IVA means they will work hard to find a proposal that both sides can accept.
What if I cannot make a payment during my IVA?
Contact your IP immediately if you anticipate missing a payment. One or two missed payments due to a short-term problem can often be dealt with through a payment holiday or by adjusting the plan. Persistent missed payments can lead to the IVA being terminated, at which point creditors can resume pursuing you for the full debt.