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Scottish IVA (Protected Trust Deed)

 

A Protected Trust Deed (PTD) is the Scottish equivalent of an Individual Voluntary Arrangement (IVA). IVAs are not available in Scotland due to differences in legislation between Scotland and the rest of the UK. Much like an IVA, a PTD is a legally governed procedure that allows you to repay your debts over a specified period of time.

There are actually many advantages to a PTD over an IVA. A PTD allows for up to 90% of your debt to be written off - compared with the potential for only 75% with an IVA. The required minimum debt is only £10,000 as opposed to £15,000 and the duration is generally 36 months for a PTD while an IVA is set at 60 months.

The basic premise and process is very similar to that of an IVA:

  • An Insolvency Practitioner (IP) is necessary to administrate and manage the PTD.
  • It is required that creditors, holding at least 75% of the debt, vote in favor of the PTD.
  • Creditors cannot add additional interest or charges to the debts during the term.
  • Payments are made monthly and distributed to the creditors through an IP.
  • Failure to meet payments may result in bankruptcy.
  • You may be required to release equity in your home.
  • You will be completely debt free at the completion of your term.


Advantages of a Protected Trust Deed:

  • Your creditors will be unable to add interest to your debts.
  • They are typically more flexible and cost less to administer than sequestration.
  • Your IP will handle all of the communication with creditors.
  • After three years you will have no debt.
  • You will most likely still be able to hold public office.
  • You will most likely still be able to serve as a director of a company or remain self-employed.

Are you eligible for a Protected Trust Deed ?

Try our simple debt solution calculator to find out.


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