There are two kinds of Voluntary Agreements applicable to those who are in debt in Britain: Individual Voluntary Arrangements (IVAs) and Company Voluntary Arrangements (CVAs). They act as an alternative to bankruptcy and - as their names convey - one is relevant to personal debt whilst the other applies to business/company debt. For this reason, it can be confusing to conclude whether a sole-trader or 'one man band' - i.e. somebody who is self-employed - should opt for an IVA or a CVA.

As it were, a person who's self-employed can opt for an IVA. This is due to the fact that a sole-trader is solely liable for his/her own business debts, whereas a company's debts are the responsibility of the company, therefore an IVA applies to the former whereas a CVA will apply to the latter. It is likely as well that, as a sole-trader, the person has accrued personal credit card and loan debts in their name, in an effort to keep on going and keep their business active and ticking over, whilst the money struggles continue on in the background.

Obviously, whether a person is self-employed or not, they still have to suit the criteria of IVAs, yet there might be alternative debt settlement options that might be more suited to their individual circumstances. For self-employed individuals in particular, if they are able to show creditors that an IVA will aid the business in surviving then the creditors are more likely to respond positively - in the long run, they would rather claw some of the cash back than the possibility of clawing none back at all.

IVAs can help people to consolidate their debt into one regular payment on an on-going basis, usually five years, so a self-employed person can work to pay back their debt whilst also being able to focus on their trade. They might have to pay back a set sum of money, so much pennies to the pound (for instance 30p per £), but if it helps them to keep the business going while satisfying creditors in the meantime then it should be a big relief to them.

IVAs can help people to get out of debt, whether they are self-employed or not, with the help of IVA services such as The IVA Service. Call them now to find out how they might be able to help.