Short answer: If a business customer that owes you money proposes a company voluntary arrangement (CVA), you will usually be asked to vote on a deal to accept less, or to be paid over time. Submit your claim with evidence and vote. An approved CVA normally binds you even if you voted against it, so the decision procedure and the 28-day challenge window are where your leverage sits. Invoices for supplies after approval are new debts you can chase normally.
A CVA proposal often lands as a long PDF from an insolvency practitioner, with a deadline to submit your claim and vote. For a supplier with an unpaid invoice it can feel like the debt has already gone. It has not, but the rules change: once a CVA is approved, the debt it covers is generally handled through the arrangement rather than through ordinary collection.
This guide is general information for UK businesses, not legal or insolvency advice. It covers England and Wales and debts owed by limited companies. Sources checked on legislation.gov.uk on 10 November 2026: Insolvency Act 1986 section 1, section 4A, section 5 and section 6, and rule 15.34 of the Insolvency (England and Wales) Rules 2016.
What a CVA is
Under section 1 of the Insolvency Act 1986, the directors of a company can propose to the company and its creditors a composition in satisfaction of its debts or a scheme of arrangement of its affairs. In plain terms, the company asks creditors to accept part payment, payment over time, or both, so it can keep trading. A qualified insolvency practitioner acts as the nominee and, once approved, usually as the supervisor of the arrangement.
An administrator or liquidator can also propose a CVA for a company already in their process. If your customer is in administration or liquidation rather than a CVA, read customer in administration or liquidation instead.
How the creditor vote works
Creditors decide through a qualifying decision procedure. Under rule 15.34 of the Insolvency (England and Wales) Rules 2016:
- a CVA proposal or modification is approved when three-quarters or more in value of those responding vote in favour;
- it is not approved if more than half of the total value of unconnected creditors vote against it.
Votes are weighted by claim value. Connected creditors (for example companies under common control) are treated separately in the second test. That is why it pays to submit an accurate claim on time with the invoice, statement and contract attached: an undocumented or late claim may be valued lower or left out.
| Stage | What a supplier should do |
|---|---|
| Proposal received | Read the dividend estimate, timescale and what happens if the CVA fails. Note the voting deadline. |
| Claim and vote | Submit your claim with evidence, including statutory interest and compensation if you are claiming them, and vote for, against, or propose a modification. |
| Decision reported | If approved, the 28-day challenge window under section 6 generally starts once the reports are made to court. |
| Arrangement running | Claim dividends from the supervisor. Chase any new, post-approval invoices in the normal way. |
When a CVA binds you
Once creditors approve it, the decision has effect under section 4A. Section 5 then says the arrangement binds every person who was entitled to vote in the decision procedure, or who would have been entitled if they had had notice of it, as if they were a party to it. Voting against does not take you outside the CVA, and neither does ignoring the paperwork.
Section 5 also covers a creditor who did not get notice: if an amount payable to them under the arrangement is still unpaid when the arrangement ends (and it did not end prematurely), the company becomes liable to pay that amount.
Challenging a CVA
Section 6 lets a creditor who was entitled to vote (or would have been, with notice) apply to court on one or both of two grounds: that the CVA unfairly prejudices their interests, or that there was a material irregularity in relation to the decision procedure. The application generally cannot be made after 28 days beginning with the first day on which the reports of the decision have been made to court, or, for a creditor who was not given notice, 28 days from the day they became aware the procedure had taken place.
A challenge is a court application that needs a solicitor or insolvency adviser. Debt Collection UK and its collection partners do not bring CVA challenges. If you think you have been treated unfairly compared with similar creditors, take advice quickly because the window is short.
What happens to your unpaid invoice
- Pre-CVA invoices. Debts the CVA covers are generally dealt with through the arrangement. You claim from the supervisor and receive whatever dividend the CVA provides, rather than pressing the company directly.
- Post-approval supplies. If you keep supplying, those invoices are new debts outside the arrangement. Agree tighter terms (shorter credit, deposits or stage payments), and chase them promptly with a letter before action if they go late.
- Retention of title. If your terms include a valid retention of title clause, check the CVA terms and take advice on whether you can still recover identifiable goods. See retention of title for unpaid goods.
- Guarantees and security. Check any personal guarantee against both the guarantee wording and the CVA terms.
- If the CVA fails. Many proposals say what happens on failure, often a move into liquidation. Your claim would then go into that process.
VAT may also be relevant. If you have written off part of the debt, read VAT bad debt relief on unpaid commercial invoices and check the conditions with your accountant.
Warning signs before a CVA is proposed
CVAs rarely come out of the blue. Longer payment delays, part payments with no explanation, a change of finance director, or requests for extended terms are common early signals. Our guide to insolvency warning signs before debt collection explains how to tighten terms and act on aged debt while the customer is still solvent and paying.
Documents to keep
- contract, terms and any retention of title or guarantee wording;
- purchase orders, delivery notes and proof of completion;
- the unpaid invoices and an aged statement, split into pre-CVA and post-approval supplies;
- the CVA proposal, your claim form, your vote and the decision report;
- every dividend notice and payment from the supervisor.
The same pack is what a partner would ask for on any later debt. See proof of debt documents.
Frequently asked questions
What is a CVA? A company voluntary arrangement (CVA) is a formal deal under Part I of the Insolvency Act 1986 between a company and its creditors. It is usually a composition (paying creditors part of what they are owed, often over time) or a scheme of arrangement of the company's affairs. A licensed insolvency practitioner acts as nominee and then supervisor.
Who can propose a CVA? Under section 1 of the Insolvency Act 1986 the directors can propose one, unless the company is already in administration or being wound up. An administrator or liquidator can also propose one for a company in their process.
How do creditors vote on a CVA? Under rule 15.34 of the Insolvency (England and Wales) Rules 2016, a CVA proposal is approved when three-quarters or more in value of those responding vote in favour. It is not approved if more than half of the total value of unconnected creditors vote against it. Your vote is counted by the value of your claim, so a clear, documented claim matters.
Am I bound by a CVA if I voted against it? Usually yes. Section 5 of the Act says an approved CVA binds every person who was entitled to vote in the decision procedure, or who would have been entitled if they had had notice of it, as if they were a party to it. Voting against does not take you outside it.
Can I challenge a CVA? Section 6 allows an application to court on the grounds that the CVA unfairly prejudices a creditor's interests or that there was a material irregularity. The application generally has to be made within 28 days of the reports of the decision being made to the court, or, for a creditor who was not given notice, within 28 days of becoming aware of the decision. This needs a solicitor or insolvency adviser, not a collection agency.
Can I keep chasing my invoice once the CVA is approved? Debts covered by an approved CVA are generally dealt with through the arrangement, so ordinary collection against the company for that debt usually stops and you claim through the supervisor. Invoices for goods or services supplied after approval are new debts and can normally be chased in the usual way if they go unpaid.
What if there is a personal guarantee? A CVA binds the company and its creditors under the arrangement. Whether a director's personal guarantee survives depends on the guarantee wording and the CVA terms, so check both and take advice before assuming either way. See our guide on personal guarantees for unpaid B2B invoices.
Can your partner help with a debt in a CVA? We are an introducer, not solicitors or an FCA-authorised firm. Debts caught by an approved CVA normally have to go through the supervisor rather than a collection agency. Where a solvent Ltd, LLP or PLC owes you a debt outside a CVA (for example post-approval supplies) and our partner accepts it, the fee is 15% of what is recovered, payable only when you have been paid. Recovery is not guaranteed.
If a trading Ltd, LLP or PLC owes you an invoice that is not caught by a CVA or other insolvency process, upload the invoice via business debt collection or read how no collection, no fee works. You can also start from unpaid invoices. The fee is 15% of what is recovered, payable only when you have been paid. Recovery is not guaranteed.