Fast-Track CVAs – The most efficient business rescue process post-COVID?


What is a Fast-Track Company Voluntary Arrangement (CVA)? A Fast-Track Company Voluntary Arrangement is a formal insolvency process that allows you to negotiate a cost-effective payment plan with creditors under time-sensitive conditions. A Fast-Track CVA is a suitable rescue option for businesses impacted by COVID-19 and requiring a prompt recovery.   Fast-Track CVAs Despite businesses […]

CVAs: Understanding the disadvantages


What are the cons of entering into a Company Voluntary Arrangement (CVA)? The drawbacks of a Company Voluntary Arrangement encompass the challenge of persuading directors to vote in favour of entering a CVA, potential limitations in securing future credit, and committing to a lengthy payment plan that may exert pressure on the company’s cash flow. […]

CVAs: Dealing with rejection or failure


What happens if a CVA is rejected or fails? What is a CVA? A company facing financial challenges has the option to initiate a Company Voluntary Arrangement (CVA). Essentially, a CVA is a structured payment plan established between the company and its outstanding creditors. It provides the company with an extended timeframe to repay its […]

CVA Debt Write-offs and Tax: Understanding Loan Relationship Rules


Understanding CVA debt write-offs and tax Corporate debt in the UK falls under specific taxation legislation known as the loan relationship rules. This legal framework, initially introduced by the Finance Act 1996, later became part of the Corporation Tax Act 2009. Now, what exactly constitutes a ‘loan relationship’? According to the legislation’s definition: “For the […]

CVAs: Understanding the advantages


What are the advantages of a Company Voluntary Arrangement (CVA)?  After determining that opting for a Company Voluntary Arrangement (CVA) is the most suitable strategy for a company, it becomes essential to generate future cash flows to verify the feasibility of the CVA. In times of financial distress, many UK companies find that pursuing a […]

Understanding Company Voluntary Arrangements (CVAs)


What is the process for a Company Voluntary Arrangement (CVA)? A Company Voluntary Arrangement, known as a CVA, is a proper way for a financially troubled company to sort out its debts. It’s like a payment plan that the company and its creditors agree on, and it’s legally binding. CVAs usually go on for 3-5 […]

Proposing a CVA: How to negotiate the agreement with creditors


Negotiating a CVA With Creditors When your company is grappling with numerous debts, and cash flow is insufficient, one of the limited options available, aside from seeking external financing, is to engage in negotiations with creditors. The aim is to request a reduction in monthly payment amounts or establish a payment plan that provides the […]

What is ‘hiving’ when used as part of a Company Voluntary Arrangement (CVA)?


Hiving assets and Company Voluntary Arrangements (CVAs) A Company Voluntary Arrangement (CVA) is a formal insolvency procedure that offers the chance to rescue a financially distressed company by restructuring its debts and reorganising its operational framework. Underperforming facets of the business can be closed down, and negotiations with creditors may result in reduced monthly expenses. […]

Company Voluntary Arrangement (CVA) vs Company Liquidation


What is the difference between a CVA and Liquidation? Company liquidation and CVAs, though both formal insolvency procedures diverge significantly in their intended outcomes. A Creditors’ Voluntary Liquidation (CVL) marks the conclusion of a business that is insolvent and beyond the prospect of recovery. Conversely, a Company Voluntary Arrangement provides an opportunity for a financially […]

How are employees affected in a CVA?


Staff and Company Voluntary Arrangements A Company Voluntary Arrangement, known as a CVA, is a structured way for qualifying companies facing a considerable downturn to reorganise. To be eligible for this arrangement, companies must be considered financially viable going forward. An authorised insolvency practitioner (IP) assesses if the company is insolvent or potentially insolvent, which […]