We understand just how hard running your own business can be. You don’t need any other added stress. If you find your business is insolvent (it cannot repay its debts as they fall) you’ll need to look for a way to pay back your creditors. There are various ways of doing this – one way is through a Voluntary Arrangement.
The three primary voluntary arrangements are: Self-Employed IVAs (Individual Voluntary Arrangements), CVAs (Company Voluntary Arrangements) and PVAs (Partnership Voluntary Arrangements). Each is tailored specifically to your business status, should that be: sole-trader/self-employed, partner in a partnership or the director of a limited company.
You could be debt-free in as little as 5 years with a ‘self-employed’ IVA. You may also be able to carry on running your business. In this debt solution, created specifically for the self-employed, you will pay back your debt in manageable instalments, typically over a 5 year period.
A self-employed IVA allows you to continue using your essential trade suppliers and lines of credit. You may also be able keep any tools, machinery or stock you need for your business.
Self-employed or bespoke IVAs with PayPlan are available to anyone who works for themselves. That is, provided there’s a debt level of £7,000 or more. Phone us for free on 0800 280 2816 or fill in our online debt-help form.
Partnership Voluntary Arrangement
A Partnership Voluntary Arrangement is set up by an Insolvency Practitioner. It is a legally binding agreement, in which you pay back your partnership’s creditors over a set period of time, usually around five years.
This is often done through monthly instalments, although it can be done through a lump sum payment. It can also be combination of both; methods of payments are flexible so long as the payment is met.
Fees are required to set up a PVA. These can generally be taken from any payments you make into the PVA, rather than being paid up front.
Company Voluntary Arrangement
If your limited company is insolvent, it can use a CVA to pay back its creditors. If your company’s creditors agree to it, your limited company will be able to continue trading.
In a CVA, your IP (Insolvency Practitioner) will decide upon a repayment arrangement based upon your affordability. They will then contact your creditors, asking them to vote on whether or not they accept it. If they agree, your CVA will go ahead.
Is your business struggling financially? Get in touch with PayPlan today for FREE impartial debt advice from experienced and friendly advisers. Give us a call on 0800 280 2816.