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By MF55
Both my wife and i are in a joint IVA. We have been in the IVA 10months only. We are both on benefits due to my wife being disabled and i am her carer. I had a letter come through the door unexpected staying that i may be due a MOD pension. To my amazement i received notification that i was it is very small £150 per month and there was a couple of hundred pounds lump sum. This was backdate until april 2019 therefore i was due arrears which they paid some £2000 i have a number of questions relating to this and would appreciate some help
1. Is this money classed as income or a windfall
2. Am i able to keep any of it as it is income
3. I am currently holding all the money in a bank account as we will have to pay monies back to the dWP as there is a potential overpayments. Am a able to spend any of it
4 I am also now getting a monthly amount can i spend it or not a
5 I have advised MY IP and as we have the potential to ow money they have said not to do a new income and expenditure as we will be doing the first annual review beginning October

Any advice would be welcome as out of our depth
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By Hayden
Hi MF55

1. If you have received a £2000 lump sum because of a pension back payment, this will 100% be classed as a windfall in your IVA. As such you will have to hand it over to your IVA company. I do not believe they will let you keep any of it (unless you have a super kind hearted IVA company).

You could consider not declaring it to them. However there is always the risk they will find out anyway when they do your annual review if they look at your bank statements and see the deposit.

2. If you are considering using any of the money to repay a debt to DWP I would confirm that you can do this in writing with your IVA company first. If you use some of the money before they confirm you can do so and then they demand you pay it all into your IVA you will be short and have a problem.

3. The fact that your income has improved by £150/mth without any change in your expenses means in theory that your disposable income has also risen by £150. Given this I would expect your IVA company will want to increase your monthly payment by 50% of the increase (around £75/mth)

4. I would not use any of your extra money at all until everything is finanlised with your IVA company. If you are not going to do this until October I strongly recommend simply putting aside all the extra money you receive until that time and not touching it. Then you will be in a position to hand over what ever funds your IVA company ask for without facing a problem.