Company Voluntary Arrangement

Company Voluntary Arrangement (CVA) | Ltd Debt

What is a Company Voluntary Arrangement (CVA)?

A Company Voluntary Arrangement (CVA) is an insolvency procedure which allows a financially troubled company to reach a legally binding agreement with its creditors. In a CVA a company can pay part of their debts back or agree payment in full over a pre-agreed period of time.

A CVA can be proposed by the directors of the company, the administrators of the company, or the liquidator of the company.

When the CVA has been proposed, a nominee (insolvency practitioner) reports to court on whether a meeting of creditors and shareholders should be held to consider the proposal.

The meeting decides whether to approve the CVA. If 75% of the creditors (by debt balance) agree to the proposal, it is then legally binding on all creditors who had notice of the meeting and were entitled to vote.

If the meeting of creditors and shareholders approves a CVA, the nominee becomes the supervisor of the CVA.

Once the CVA has been carried out, the company’s liability to its creditors is cleared. This allows the company to continue trading throughout the CVA and afterwards. Once the CVA has been completed any remaining debts will be legally written off and the company continues to trade as before. 

CVAs can even be set up when a company is in liquidation or administration.

How does a CVA get approved?

A CVA proposal is drafted by the directors with the assistance of our Insolvency Practitioners. The proposals are then sent out to all interested parties (court, creditors and shareholders) allowing 14 days notice of the creditors meeting for the CVA.

At the CVA creditors meeting 75% of the creditors (by debt balance) vote either in person or by proxy at the meeting must approve the CVA.

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Limited Company Debt Solutions


When a company gets into financial trouble an administrator may be appointed to help the company through the difficult times and start trading again if possible.

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A Company Voluntary Arrangement (CVA) is an insolvency procedure which allows a financially troubled company to reach a legally binding agreement with its creditors.

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Liquidation usually means, the company’s trading stop and its assets are turned into cash or “liquidated”. All other possible liabilities, like employment or renting are stopped.

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When a company borrows money from a bank on an overdraft or loan, it will be common for the bank to ask for a security (debenture) against such a loan.

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For more on CVAs…
Call McCambridge Duffy’s Business Debt Advice line on: 0800 0436 999

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Business Debt Advice is owned by McCambridge Duffy who are one of the leading Insolvency firms in the UK and have been in the financial industry since 1932. McCambridge Duffy solely provide IVAs and other Insolvency solutions.

On our site you will find information on debt solutions, both formal and informal. We provide this information so you have a clear overview of the options available for dealing with your debts. We do not offer informal debt solutions, so if an insolvency solution is not your recommended course of action, with your permission, we will refer you to an appropriate agency/provider that can assist you further.