CBW Recovery

Placing a company into administration provides breathing space, free from creditor pressure, for a strategy to be put in place. All outstanding or future legal action by creditors will be halted, while the administrator is appointed to take control of the company to negotiate the best outcome for the creditors.

While often a difficult choice it's often best not to find yourself stuck in a sunk cost fallacy. When insolvency does hit liquidation can prevent tensions from rising with creditors, relieving pressure from all parties.

CVA provides the opportunity for a company to negotiate a legally binding repayment plan with outstanding creditors, these will typically last between 3-5 years. This can result in some debt being written off, with the remainder paid back through affordable and sustainable monthly repayments. This allows a company to continue to trade during this time, allowing it to use future profits to pay existing debts.

A CVA can be started when 75% (by value) of creditors agree to it's implementation. Therefore, a convincing proposal must be offered, with a substantial enough monthly financial contribution to satisfy creditors, while also demonstrating the company’s viability as a trading entity.

Usually following a statutory Demand left ignored creditors of a company, owed £750 or more, can present a winding up petition. If a winding up petition has been received you have only seven days to respond before the courts will consider issuing a Winding up Order, which would shut down the company.

In these cases, there are often 3 possible options: Administration, Company voluntary arrangement or dispute of debt (litigation). However, all three must be started within the seven-day window. This is why it is vital to consult with a licensed Insolvency Practitioner immediately.

When wanting to end an insolvent company a CVL is a quick and effective option. Ensuring debts are paid to the fullest extent possible, with the remainder being written off. This method can help relieve owners of the burden of trying to ensure creditors are paid out without bias and in the legally correct order.

A legally binding agreement between the debtor and creditors. An IVA affords the insolvent individual a chance to reorganise their financial affairs to the satisfaction of all parties. To initiate an IVA 75% (by value) of creditors must approve, which means debtors will need to prove the advantages of the IVA over a much shorter Bankruptcy.

The IVA will often last a total of 5 years and will require regular payments throughout. It also will not protect your credit score but can protect an accountancy licence.

The professional way to close the doors and start your next adventure. When closing down a company its best to leave no outstanding matters to haunt whatever you choose to do next. MVL’s are tax efficient ensuring a lucrative exit for shareholders.