Company Voluntary Arrangement (CVA)
A Company Voluntary Arrangement, or CVA, is a legally binding deal between a company and its creditors to repay some or all of its debts over a fixed period, usually three to five years, while the company keeps trading. It becomes binding on all unsecured creditors if those representing at least 75% by value of those voting approve it. It is one of the main UK business rescue tools. Insolvency Act 1986, Part I; gov.uk
- What it is
- A binding deal to repay creditors over about 3 to 5 years
- Approval needed
- 75% by value of creditors who vote
- Who keeps control
- The directors, supervised by a practitioner
- Best for
- A viable business that can afford realistic monthly payments
- Risk
- Failing the CVA usually leads to liquidation
Talk it through, free and confidential No obligation. We review your situation and point you to the right next step.
How a CVA is agreed
A CVA is proposed with the help of a Licensed Insolvency Practitioner, who acts as nominee and then supervisor. Creditors vote on the proposal, and once approved it binds all unsecured creditors.
When a CVA is the right tool
A CVA works when the business can trade profitably going forward but is weighed down by historic debt such as HMRC arrears or supplier balances, for example after a one-off shock, and can afford a realistic monthly contribution from future profits. It avoids liquidation, lets you keep trading and keep control, and protects jobs. It requires honest, achievable forecasts, because failing a CVA usually leads to liquidation. If the business isn't viable, liquidation is usually more honest and cheaper.
Related data
Our 2025 insolvencies by type breakdown: How rare CVAs are next to liquidations and administrations, in numbers. Every page on our data hub names its official source.
Where to go from here
- If you decide to speak to a Licensed Insolvency Practitioner, choose your own: our practitioner directory lists every practitioner on the official Insolvency Service register, and how to choose an insolvency practitioner explains what to ask. Always confirm their entry on the official register before you instruct anyone.
Common questions
Does a CVA affect my credit and contracts?
The company enters a public arrangement, which suppliers and lenders can see, so terms may tighten. But it avoids the far greater damage of liquidation and lets the business continue.
What happens if I miss CVA payments?
The supervisor can terminate the arrangement, which usually triggers liquidation. That is why the monthly figure must be realistic from the start, based on honest forecasts.