HB Overpayments and I.V.A

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    What is the position on recovering HB overpayments when someone has an IVA in place.

    Are LA’s still able to make deductions from on going housing benefit or must we accept whatever is offered through the IVA ?



    Anyone got an answer to this very grey area ?


    An IVA is drawn up to avoid bankruptcy and the clt’s “offer” will have taken into account his (net) HB income. You can continue to recover the overpayment unless and until the debt becomes an insolvency one.


    Hi we had been approached by a insolvency practitioner requesting we support their clients request for an IVA. As he is entitled to HB, the overpayment of £9K is currently being recovered by making deductions from his ongoing HB.

    We had refused to support the IVA, and they have come back us stating if accepted in addition to recovery from his ongoing benefit, we would also receive dividends at a percentage of the total debt? Therefore, with estimated ongoing recovery over 5 years and dividends at 46% total debt £9K will be repaid in full.

    I think we would only be entitled to the 46% of the total debt, agreed in the IVA. The balance of 54% on discharge would be written off is this correct?

    Also as far as I’m aware debt included in IVA can only be recovered by making deductions from HB or prescribed benefits?

    Comments welcome,

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