Cost of Company Voluntary Arrangement

There are various costs associated with a Company Voluntary Arrangement. A Statement of Affairs fee will normally be charged up front. There are then additional fees once the Arrangement is in place.

  • The costs of a Company Voluntary Arrangement explained
  • Will anything have to be paid up front?
  • What are CVA Nominee and Supervisor Fees?
  • How does the company pay these charges?

Do you want help to start a CVA? Give us a call (0800 180 8440) or complete the form below to speak to one of our experts

CVA Statement of Affairs Fee

Before a Company Voluntary Arrangement (CVA) can be proposed a Statement of Affairs has to be produced. This must include an analysis of the company’s current financial position and debt profile. In addition trading projections for the next 12 -18 months are required.

Depending on the amount of work involved the charge for the Statement of Affairs will normally range between £2000-£5000. Finding these funds can be a daunting task. However one way the company can do this is by suspending further payments to unsecured creditors.

The CVA Statement of Affairs fee will normally be significantly less than the amount required to fund an alternative company rescue solution such as a pre pack liquidation.

Company Voluntary Arrangement Nominee Fee

The Nominee fee is made by the Insolvency Practitioner (IP). It is for drafting the Company Voluntary Arrangement proposal and negotiating its agreement with the company’s creditors.

The size of the Nominee fee will vary depending on the nature of the Arrangement. The amount is made clear to all parties in the proposal documents. It is not normally charged until the CVA is agreed. At that point the IP then draws the fee from the payments that the company makes into the Arrangement.

Neither the company or directors are expected to provide extra cash to pay the Nominee fee. It is taken from the agreed payments that the company makes.

Company Voluntary Arrangement Supervisor Fees

Supervisor fees are charged by the IP every year that the CVA is in place. These charges are to pay for the work that the IP has to undertake to manage the Arrangement. The level of these fees will vary. How they are calculated will be made clear in the CVA proposal documents.

The ongoing work that the supervisor has to undertake normally includes the following:

  • Collecting the agreed CVA payments and making sure they are paid on time
  • Making distributions to creditors as per the terms of the Arrangement
  • Monitoring the progress of the CVA in accordance with the proposal
  • Carrying out an annual review of the company’s circumstances
  • Working with directors to manage any changes in company circumstances

As with the Nominee fee Supervisor fees are not paid directly by the company. The IP draws them from the agreed payments that the company makes into the Arrangement.

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