Originally written by Timothy Adler on Small Business
Any small business that needs protection from creditors while it continues to trade through Covid-19 will find it easier now the CVA process has been simplified.
Insolvency body R3 has published a standard form extending the help bigger companies get when they go into administration but continue to trade.
Although high-street names such as New Look and Travelodge have entered company voluntary arrangements (CVAs) until now they have been too complicated and costly for small businesses on life support.
>See also: Why the Government’s new insolvency bill is bad news for sole traders
What is a CVA?
A CVA is a form of insolvency used by businesses to cut debts, restructure their capital or dispose of assets such as property leases.
At least 75 per cent of unsecured creditors must agree to such a proposal for it to go ahead.
The R3 standard form details what businesses need to do to reach an agreement with their creditors, settle their debts and turnaround their business.
The form includes a breathing space period to allow a business time to restructure without fear of action from its creditors, to be followed by a payment period where a company’s debts are paid in line with

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