Company Voluntary Arrangement (CVA)

A Company Voluntary Arrangement also known as a CVA is a debt solution for businesses having financial difficulties. Introduced by the government it is an insolvency procedure designed to enable a financially troubled business to restructure and eventually clear its debts. By entering your business into a company voluntary arrangement you make a legally binding agreement to repay some or all of your debts to your creditors over an agreed period of time.

The main aspects of a CVA are that it –

• Enables your business to continue to trade with a view to increasing the return to your creditors over a fixed period of time.
• Immediately stops all winding up procedures and actions by your creditors.
• Reduces your debt repayments to an amount more affordable to your business.
• Allows company directors to continue to manage business affairs.

A CVA can be proposed by company directors, administrators or liquidators. They aren’t however the solution to all business debt problems. Every case is different and so what works for one company may not be suitable for another. Therefore entering into a company voluntary arrangement must be given some thought and getting professional advice is recommended.

Some of the main advantages of Company Voluntary Arrangements include –

• Your CVA will be kept private and it is legally binding.
• You will be protected from your creditors providing you stick to the terms of your CVA.
• Your business can continue trading under the control of the directors.
• Allows you time to repay your debts and devise a structured plan for the future of your business.
• It is a way of avoiding outright insolvency.

The disadvantages of CVAs include –

• Your creditors may take legal action against you if you fail to stick to the terms of the CVA.
• You may struggle to secure credit for your company because of your CVA.
• Some basic details of the arrangement are available to the public.

Independent CVA Advice for UK Businesses

Our business debt restructures always start with an initial confidential discussion with you. We can provide a wide range of specialist accounting, financial and insolvency advice for your business. We can liaise with your accountants, bankers and creditors as necessary to ensure that we provide the most appropriate solution for you and your business whether that is a company voluntary arrangement or an alternative debt solution.

If you would like further information, without obligation, on the business debt solutions available to you then call our helpline free today on 0800 043 50 43 or complete our enquiry form and we will ring you back at a more suitable time.