A Company Voluntary Arrangement (CVA) is a formal agreement between a company and its creditors to repay debts over a fixed period. It allows your business to continue trading whilst paying creditors under new terms which provides breathing space. The CVA process is overseen by a licensed Insolvency Practitioner.
A Company Voluntary Arrangement (CVA) is a legally binding agreement between your company and its creditors that allows the business to repay debts over an agreed timeframe, typically three to five years. Once approved by creditors, it protects your company from further legal action whilst the arrangement remains in place.
The CVA process is overseen by a licensed Insolvency Practitioner who acts as the supervisor throughout the arrangement, ensuring compliance with the agreed terms and providing regular reports to creditors.
CVAs are legally binding once approved by creditors, which means that all unsecured creditors are bound by the terms of the proposal. This provides the company with protection from legal action and allows breathing space to restructure debts whilst continuing to trade.
Meet with an Insolvency Practitioner to discuss your company's financial situation and determine if a CVA is the right solution.
The Insolvency Practitioner prepares a detailed proposal outlining how creditors will be repaid, including payment schedules and terms.
Creditors vote on the proposed arrangement. Approval requires 75% by value of those voting to agree to the terms.
Once approved, the CVA comes into effect. The Insolvency Practitioner supervises the arrangement and ensures compliance with the agreed terms.
After fulfilling all obligations under the CVA, your company returns to normal trading without the debt burden.
A Company Voluntary Arrangement offers a lifeline for businesses facing financial pressure, providing a structured path to recovery whilst continuing to trade. This formal agreement with creditors can halt legal action, protect your company from winding-up petitions, and give you the breathing space needed to stabilise operations.
Benefit
What this means for you
Continue trading
Unlike liquidation, a CVA allows your company to continue operating. You retain control of day-to-day operations, maintain customer relationships, and preserve jobs whilst working through your financial difficulties.
Legal protection
Once approved, a CVA provides immediate protection from creditor legal action. Winding-up petitions are stayed, and creditors cannot pursue individual claims whilst you meet the agreed terms.
Flexible repayment terms
CVAs offer flexibility in structuring repayments based on your company's actual cash flow and trading projections. This realistic approach gives your business the breathing space needed to recover.
Preserve business value
By continuing to trade, you maintain the value of your business, customer base, and supplier relationships. This is often far more beneficial than the alternative of formal insolvency proceedings.
Director control
You remain in control of your company throughout the CVA process, working with your Insolvency Practitioner rather than having the business taken over by an administrator.
Creditor compromise
Creditors often prefer CVAs as they typically receive better returns than through liquidation, and unsecured creditors may agree to write off a portion of debt in exchange for structured payments.
A Company Voluntary Arrangement can only be proposed and supervised by a licensed Insolvency Practitioner. Our network of practitioners brings extensive experience in structuring and supervising CVAs across all business sectors.
We conduct thorough financial assessments to demonstrate to creditors how debts will be repaid. Our practitioners handle all creditor negotiations and provide ongoing supervision throughout the arrangement, monitoring compliance and liaising with creditors on your behalf.
All our Insolvency Practitioners are fully licensed and regulated.
What is the success rate of a CVA?
The success rate of a CVA depends on various factors including the viability of the business, the level of creditor support, and the company's ability to meet the agreed payment terms. A well-structured CVA proposal with realistic projections and strong management commitment typically has a higher chance of success.
How long does a CVA last?
Most CVAs run for between three to five years, though the exact duration depends on the company's circumstances and what creditors agree to. The timeframe is determined by how long it will reasonably take your business to repay the agreed proportion of debts whilst maintaining operational viability.
Will my company be able to continue trading during a CVA?
Yes, one of the key benefits of a CVA is that your company can continue trading throughout the arrangement. This allows you to generate the income needed to meet your CVA payments whilst preserving jobs, maintaining customer relationships, and keeping your business operational.
What happens if my company cannot meet the CVA payments?
If your company fails to meet the agreed payment terms, creditors may petition to wind up the company. However, if circumstances change, it may be possible to renegotiate terms with creditors or explore alternative solutions.
How much does a CVA cost?
The costs of a CVA include the Insolvency Practitioner's fees for preparing the proposal, obtaining creditor approval, and supervising the arrangement. These fees are typically built into the CVA payments and agreed by creditors as part of the proposal. Your Insolvency Practitioner will provide a clear breakdown of all costs during your initial consultation.
Will a CVA affect my company's credit rating?
Yes, a CVA will be recorded on your company's credit file and may affect your ability to obtain credit in the future. However, successfully completing a CVA demonstrates your company's commitment to meeting its obligations and can be viewed more favourably than formal insolvency proceedings.
Can landlords and HMRC vote on a CVA proposal?
Yes, all creditors including landlords and HMRC can vote on a CVA proposal. Recent legislation has introduced specific provisions regarding the treatment of landlords in CVAs, and HMRC has particular rights as a preferential creditor. Your Insolvency Practitioner will ensure the proposal complies with all current regulations.
What is the difference between a CVA and Administration?
A CVA is a voluntary agreement that allows your company to continue trading under existing management whilst repaying creditors over time. Administration is a formal insolvency procedure where an administrator takes control of the company to rescue it as a going concern. A CVA is generally less disruptive and allows directors to retain more control.
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Insolvency Practitioners is a trading name of BTG Begbies Traynor (Central) LLP a limited liability partnership registered in England and Wales No. OC306540. The firm is authorised by the FCA to undertake debt counselling and debt adjusting and its reference number is 660455. Copyright 2026 Insolvency Practitioners, all rights reserved.