What happens if a CVA is rejected or fails?
A rejected CVA does not create the proposed repayment protection, while a failed CVA must be dealt with under its agreed terms. The company may need a revised proposal, another rescue route or liquidation. Speak to the proposed practitioner or supervisor before missed payments become a wider crisis.
Business Insolvency Helpline • Checked 1 November 2026
General guidance, with procedural detail focused on England and Wales. Rules and routes can differ in Scotland and Northern Ireland.
What if creditors reject the proposal?
Ask why support was insufficient: creditors may question affordability, the proposed return, information quality or treatment of particular debts. Establish whether a revised proposal could solve the objection without making promises the company cannot deliver.
A CVA needs the required creditor approval. Secured and preferential creditor rights require separate attention, so it is not simply a majority vote that overrides every kind of claim.
What if the company misses payments after approval?
Read the default and variation provisions with the supervisor. A temporary problem may be capable of an agreed response; a permanent loss of viability needs a different decision. Do not reduce contributions unilaterally and assume the arrangement remains compliant.
Include new tax and supplier debts in the review. Paying the CVA while allowing fresh arrears to grow is not a sustainable recovery.
Which alternatives should be considered?
Review whether administration could preserve value or whether a CVL is now appropriate. A winding-up petition may also become a risk. The outcome depends on assets, funding, creditor rights and the cause of failure.
Prepare a revised forecast and explain what changed from the original proposal. A realistic account of the problem helps distinguish a repairable arrangement from one that should end.
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Related questions
The agreed terms govern payment and release. Do not assume the entire balance disappears immediately or remains released if the arrangement fails.
A variation may be possible under its terms and approval requirements. Discuss it with the supervisor before changing payments.
Not invariably, but another viable and funded route must exist. If the business cannot be rescued, liquidation may be necessary.
Sources checked for this guide
- Company voluntary arrangements (www.gov.uk)
- Director information hub company voluntary arrangements (www.gov.uk)
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