CVA’s drop 47% after HMRC changes Debt Collection rules

The latest Data analysed by Mazars shows the number of struggling businesses applying for Company Voluntary Arrangements (CVAs) has fallen by 47%. It is suggested that this large drop is due to a change in the laws in 2020 which made HMRC a preferred creditor when businesses go bust.
A company voluntary arrangement (CVA) can be used when a company is insolvent. It is an agreement to pay creditors over a fixed period. If the creditors agree then the business can continue trading.
CVAs have fallen