Company voluntary arrangements are the most organised and efficient way to rejuvenate a cash strapped company. Every type of company has proposed a Company Voluntary Arrangement at one time or another. This is just as well given the way that small businesses often get the short end of the stick.
Recently, the Infamous Vodafone HMRC deal that settled an inter-group transfer pricing arrangement has now being slowly revealed. If you are an international company, it seems like HMRC will do a deal with you. However, if you are a small company then it would appear that you have no chance with HMRC.
Most company directors know the feeling of being trapped by their company. Everything starts out great. There’s excitement and enthusiasm all around. Gradually the pressure increases and its not much fun anymore. There becomes very little room for manoeuvre as the business has to work because the home is charged to the bank. Credit limits weaken and so does the directors resolve as vicious circles become the regular pattern. HMRC
debt builds up to such an extent that a winding up petition is threatened and trade creditors are refusing to supply until some of the old invoices are cleared.
Company voluntary arrangements are designed for such scenarios. They will wipe out a proportion of the debts, including HMRC debt, and spread the remaining balance over a five year repayment scheme. It does take time for some directors to accept that such a procedure is available and legal. Google it as even the Government has information about Company Voluntary Arrangements.