A Company Voluntary Arrangement (CVA) lets you continue trading while paying creditors a reduced amount over time. Find out if it's the right option for your business.
A CVA allows you to continue trading while paying creditors a reduced amount over 3-5 years. It's often the best alternative to liquidation for viable businesses with temporary cash flow problems.
A Company Voluntary Arrangement (CVA) is a formal agreement between a company and its creditors to pay back debts over an extended period, typically 3-5 years. It's designed for businesses that are fundamentally viable but experiencing temporary cash flow difficulties.
We prepare a detailed proposal showing how creditors will be paid over time, typically offering 20-40p in the pound.
Creditors vote on the proposal. We need 75% approval by value of debts to proceed.
Once approved, you make monthly payments as agreed while continuing to trade normally.
After 3-5 years, remaining debts are written off and your company is debt-free.
CVAs have an excellent success rate when properly structured and managed by experienced professionals.
| Feature | CVA | Administration | Liquidation |
|---|---|---|---|
| Director Control | ✅ Retained | ❌ Lost | ❌ Lost |
| Continue Trading | ✅ Yes | ⚠️ Maybe | ❌ No |
| Debt Reduction | ✅ 60-80% | ⚠️ Variable | ✅ 100% |
| Duration | 3-5 years | 12 months | 6-12 months |
| Business Survival | ✅ High | ⚠️ Medium | ❌ None |
CVAs work best for viable businesses with temporary cash flow problems. Here's how to determine if a CVA is right for your company.
Your business is likely suitable if:
Your business is fundamentally sound with good future prospects
Problems are due to temporary factors, not fundamental business failure
Creditors are likely to accept reduced payments over liquidation
Can generate enough cash to make CVA payments and cover ongoing costs
Directors are committed to the turnaround process
Consider alternatives if:
Core business model is flawed or market has permanently changed
Cannot generate enough cash to make CVA payments
Major creditors are unlikely to support the proposal
Liquidation would provide better returns to creditors
History of director misconduct or trading while insolvent
Not sure if a CVA is right for your business? Our experts will assess your situation and provide honest advice on the best way forward.
Comprehensive review of your situation
Your information stays private
Honest advice with no pressure
Understanding the CVA process helps you prepare and increases your chances of success. Here's exactly what happens from start to finish.
We conduct a thorough review of your business finances, assess viability, and determine if a CVA is the best option.
We prepare a detailed CVA proposal including payment terms, business projections, and nominee's report.
Creditors and shareholders vote on the CVA proposal. We need 75% approval by value of debts.
Once approved, the CVA becomes legally binding and monthly payments begin as agreed.
Every business rescue option has pros and cons. Here's an honest assessment of CVAs to help you make an informed decision.
Why CVAs are often the best option
Unlike administration, you keep full control of your business and can continue making strategic decisions.
Typically pay only 20-40p in the pound, writing off 60-80% of unsecured debts.
Business operations continue as usual, maintaining customer and supplier relationships.
Once approved, creditors cannot take enforcement action or wind up the company.
Payments can be structured to match your cash flow, with seasonal adjustments if needed.
Maintains goodwill, customer base, and business relationships that would be lost in liquidation.
Potential drawbacks to consider
Need 75% approval by value - if major creditors object, the CVA fails.
Typically 3-5 years of monthly payments - a significant long-term commitment.
CVAs are publicly registered, which may affect your credit rating and business reputation.
Annual supervisor fees of £2,000-£5,000 throughout the CVA term.
If you can't maintain payments, the CVA fails and liquidation may follow.
Obtaining new credit during the CVA term can be challenging due to the public record.
These key factors are essential for achieving CVA success
Conservative cash flow forecasts that you can actually achieve
Early engagement with major creditors to secure support
Implementing necessary business improvements during the CVA
Regular review and adjustment to ensure continued success
Don't let debt destroy what you've built. Our CVA experts will assess your situation and provide honest advice on whether a CVA is right for your business.
Comprehensive review with no obligation
Your information stays private
We understand urgency matters
Common questions about Company Voluntary Arrangements
"Contact us today, we'll take immediate action, and your worries can finally end."
Understanding all your business rescue options helps you make the best decision
Formal insolvency procedure with independent administrator
Compare OptionsRescue viable business through pre-arranged sale
Learn MoreOrderly wind-down of insolvent company
View DetailsUse our interactive decision tool to find the best solution for your situation.
Compare All Recovery OptionsFree guides and tools to help you understand CVAs and assess your options
Everything you need to know about CVAs - process, costs, and success factors
Read Guide →Detailed comparison to help you choose the right procedure
Compare Now →Free 47-point assessment to evaluate your CVA eligibility
Take Assessment →Determine urgency level and best recovery approach
Assess Now →Directors face personal liability risks during insolvency procedures. Understanding your obligations and protections is critical.
A complete guide to setting up a CVA, from initial assessment through to creditor approval and ongoing compliance.
Before proceeding, confirm a CVA is suitable for your situation:
A licensed insolvency practitioner (IP) must be appointed to supervise the CVA:
The IP will need comprehensive financial data to prepare the proposal:
The IP prepares the formal proposal document, which must include:
Creditors vote on whether to accept the proposal:
Once approved, strict compliance is essential:
Wondering if a CVA is right for your business?
Check Your CVA Eligibility