PVA & Individual IVA's - Explained

The two procedures can be used simultaneously where there are a number of partners whose financial circumstance differ i.e. some do not have personal debts, some do. Also the partnership itself is under pressure from creditors.

All the partners are vulnerable to action from partnership creditors and the partners with personal debts need protection from personal creditors.

Example

A law practice with 10 partners has solvency problems and needs to consider a PVA in relation to partnership debts. However, there are four partners who in addition to the partnership debts, have personal debts which exceeds the value of their personal assets. These partners therefore need to put forward a deal to their personal creditors which will also relieve pressure on the partnership as these partners’ drawings requirements were unsustainable.

The PVA allows the partnership to repay as much of its debt over a defined period of time. The partnership’s assets and the partner’s personal assets are not however, protected from action by personal creditors of the four partners. Therefore IVA’s for these four partners, if approved, would protect both personal and partnership assets.

 

The Next Step

The options for a financially distressed business need to be very carefully considered. Simply forward your details on our Contact Form and we will contact you. Alternatively ring us on our FREE ADVICE LINE 0800 781 0990.

 

All debt solutions should be very carefully considered. Fees will be charged if a solution is taken in order for us to advise and administer the most appropriate action - all fees will be outlined during your consultation. Retained payment may place you further into arrears. The Business Debt Advisor complies with the Consumer Credit Act and you have the right to a cooling off period of 7 days. It is likely that your ability to obtain further credit in the short term will be affected and this may also be the case over the medium to long term.
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