Partnership Voluntary Arrangement (“PVA”)
Broadly speaking, a PVA is a legally binding contract between the partnership and its creditors where the partners want to save the business but cannot afford to pay all of the debts due now.
It usually involves a freezing of interest and partially writing off debts with an agreed payment plan over one to five years, whilst continuing to trade.
If suitable, a PVA can mean a fresh start for the partnership. This insolvency procedure tends to be proposed as an alternative to liquidation when the Partners wish to continue to trade the partnership. This can mean that a business can be saved and employees may be able to keep their jobs.
This can also mean that the Partners are able to retain control over the business under the Supervision of Neville & Co, who ensure that the partnership adheres to the terms of the PVA.
Successful PVAs usually have a better outcome for the partnership and the creditors than liquidation because the partnership continues to trade and creditors usually get a higher dividend.
At our initial free meeting we can provide Partners with advice as to whether a PVA is the best option for your partnership in the circumstances or whether an alternative should be considered. We can explain the pros and cons of all of your options available to help you make the right decision
When to consult us
The sooner we are consulted the sooner we can assist you in finding a way through the business difficulties you are facing. The later it is left, the fewer the options will be. The best time to consult is as soon as you become a distressed company and any financial difficulties become apparent. You don't want to be building up company debt, unpaid invoices and outstanding creditors through wrongful trading and end up an insolvent company in a difficult financial position facing legal action.
If you are a struggling company or have been affected by Covid 19, contact us now for confidential advice. We are a local business supporting local businesses covering all of Devon, Cornwall and Somerset.