Contact us:
T: +44(0)1795 538 853
F: +44(0)1795 538 868
Granville House
49 The Mall
Faversham
Kent ME13 8JW
info@augustakent.co.uk
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Partnership Voluntary Arrangements (PVA)
Partnerships differ from limited companies in that the partners are personally liable for any debts incurred by the business. Therefore, this formal insolvency procedure is ideally used in conjunction with personal insolvency procedures, to protect both the assets of the partnership and the individuals who act as partners.
The PVA is a useful insolvency procedure for viable partnerships which are having financial difficulties in the short term and need breathing space. It enables the business to reach a constructive agreement with all its creditors whereby a percentage of debts owed them are repaid – either through the sale of business assets or from future income of the partnership.
The amount that is repaid eventually will depend upon what the business can afford, coupled with what the creditors will agree to. All the creditors are treated the same with respect to the percentage of debt that is repaid and at least 75% of them must agree to the arrangement. In may cases, there will be outstanding monies owed to all creditors that will be written off and never paid.
This constructive solution enables the partnership to move forward as a viable business, continuing to trade with creditors who may themselves be compromised if the partnership ceased to trade.
Voluntary arrangements are supervised by a licensed insolvency practitioner who is nominated in the first instance by the partnership, followed with full ratification by the creditors.
At Augusta Kent, we have extensive experience of these types of procedures and will be able to help you find the best route forward. Contact us for your free initial consultation to see how we can help your business.
Sole Traders
Sole traders are personally liable for their business’ debts. As such, personal informal and formal insolvency procedures are applicable in this case. Please see the personal insolvency information section to find out more or contact Augusta Kent for your free initial consultation.
The information presented is for information purposes only. The information is not, and is not intended to, amount to professional advice and should not be applied to specific circumstances. No responsibility for its accurateness and correctness, or for any consequences of relying on it, is assumed by Augusta Kent Limited. We strongly advise that you contact us or any other licensed insolvency practitioner for specific, personal advice.
