What is a restructuring plan?
A Part 26A restructuring plan is a court-supervised process for a company facing financial difficulties to reorganise liabilities. It can bind dissenting creditor classes where statutory conditions are met and the court approves. It requires a viable proposal, evidence and funding; it is not an automatic debt reduction.
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.
How is it different from a CVA?
A CVA follows its own creditor approval process through an insolvency practitioner. A restructuring plan involves creditor or member classes and court oversight, with different powers and safeguards. A scheme of arrangement under Part 26 is another distinct procedure.
Do not select a route simply because a headline suggests a larger write-off. Compare the company’s creditor mix, security, available funding and realistic alternatives.
What will the proposal need to address?
The plan needs to explain the financial difficulties, proposed changes and expected outcome without the plan. Valuation and the treatment of affected groups can be central. Court approval is a substantive assessment, not a formality after a vote.
HMRC has published guidance on its engagement with restructuring schemes and plans. Tax balances, returns and the proposed treatment should be accurate and clearly explained.
Is it suitable for a small company?
Potentially, but complexity and professional costs can make another route more proportionate. Obtain a comparison with an informal agreement, Time to Pay, CVA, administration or closure as appropriate.
Prepare a short business case: what activity remains viable, what needs to change, who funds the transition and why creditors should support the result. A legal mechanism cannot replace a workable operating plan.
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Related questions
No. Binding dissenting classes depends on statutory conditions and the court’s discretion. Do not assume a proposed plan will be sanctioned.
No. Separate protection may be needed. Ask about the position while the plan is being developed.
No. Part 26A is a formal court process. An informal plan depends on agreement and does not have the same binding powers.
Sources checked for this guide
- Using debt management schemes to restructure a companys finances (www.gov.uk)
- 26A (www.legislation.gov.uk)
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