What the IVA Protocol is
The Individual Voluntary Arrangement (IVA) Protocol is a voluntary agreement published by the Insolvency Service that provides a standard framework for dealing with consumer IVAs. It applies to consumers, Insolvency Practitioners and creditors.
An IVA itself is a legally binding agreement between a person who is insolvent and their creditors, administered by a licensed Insolvency Practitioner. Protocol IVAs follow the standard framework and, from 1 July 2025, all new protocol IVAs must follow the 2025 Protocol.
Why the protocol was revised
In 2024 the Insolvency Service published research that examined 310 IVAs registered and terminated between 2021 and 2023. The research found that 60 per cent of terminated IVAs showed evidence of poor practice in the early stages.
The revised 2025 Protocol is the outcome of the Insolvency Service working alongside regulators, the trade association R3, creditors, IVA providers and charities. The aim is to safeguard people in debt from poor practice and bring greater clarity for Insolvency Practitioners.
Key changes introduced by the 2025 Protocol
1. A new "key facts" document
The new protocol introduces an easy-to-read key facts document which must be given to a consumer before they sign up to an IVA. It covers:
- Implications for homeowners
- Fees charged by IVA providers
- How monthly repayments are calculated
- The impact on individual credit scores
2. Tighter suitability rules
The protocol states that protocol IVAs are not suitable for consumers with very low levels of debt. Where a consumer's debts total less than £7,000, the reasons why a protocol IVA is considered the most appropriate solution must be clearly explained in the proposal.
The protocol also provides clearer guidance for when an IVA may not be suitable — for example, where a consumer qualifies for a Debt Relief Order.
3. Changes to the treatment of the family home
The consumer's family home will no longer form part of an IVA where providers and creditors follow the protocol. Property equity of less than £10,000 is disregarded (the previous threshold was £5,000). Where equity is more than £10,000, the IVA term will extend from 60 months to 72 months.
4. Length of a protocol IVA
Protocol IVAs should be proposed for a length of 60 months, or 72 months if the consumer has a beneficial interest in a family home worth £10,000 or more. To calculate this beneficial interest, 85 per cent of the property's value is used, minus any secured borrowings such as a mortgage.
5. Signposting requirement on termination
Where a protocol IVA is terminated, Insolvency Practitioners should signpost the consumer to free, regulated debt advice, or satisfy themselves that the consumer is aware of the suitable debt solutions and debt advice services available.
Where to learn more
The full IVA Protocol 2025 and accompanying key facts document are published on GOV.UK. People considering an IVA can ask their Insolvency Practitioner for the key facts document and the official Insolvency Service animated video that explains how IVAs work.