Can a company director do an IVA

If you are a company director, you can use an IVA to manage your personal debts without resigning. You can also become a director part way through an IVA if you wish.

Key takeaways

• An IVA does not include company debts. Your company must continue to pay these. However, if you have personally guaranteed a company debt, this should be highlighted in your IVA.

• In the case of small company directors, where both your personal and company bank accounts are held with the same bank, you may need to change the company bank account. If the bank becomes aware of your IVA, this might trigger them to withdraw company credit facilities.

• As a director, your company shares normally remain your property after you start an IVA. This is unless they have a specific and significant resale value.

• The company’s Articles of Association many need to be ammended if an insolvency clause exists.

Use this guide to explore more about the impact of an IVA on your company as a director. Find out how an IVA can help you stay in your role while managing your personal debts effectively.

Includes our case study about Joe. Joe started his IVA in October 2025. He is a director of his own plumbing and heating limited company.

Contents

Is it possible to start an IVA if you are a company director?

You can work as a company director if you start an IVA.

Where you are already a director, you can use an IVA to manage your personal debts. You don’t have to resign from your position.

In fact, one of the motivations for the introduction of the IVA debt solution in 1986 (as part of the 1986 Insolvency Act) was to assist company directors with their debts.

Prior to 1986, the only option for a company director to manage personal debt (without having to resign) was to agree an informal repayment plan.

The debt management plan option is still available to you. However it gives no legal protection and can mean the debt repayment period extends for many years.

Can you become a company director during your IVA

Yes, you are allowed to be appointed as a director of a company before your IVA is completed.

You could become a director of a brand new company that you set up. Alternatively you can start working as a director of a company that already exists.

Do you have to change your Company Articles?

Every company has a set of internal rules which govern how it should be run. These are called the Articles of Association (or the Articles for short).

It is possible that your company’s Articles have an insolvency clause. This will state that if a director becomes insolvent, they can’t continue working in the position.

Where this clause exists, it can’t just be ignored.

Technically breaking the Articles could potentially lead to you becoming personally liable for company debts.

Given this, if you want to continue to act as a director, you will need to do the following:

• The shareholders have to pass a special resolution in a general meeting to change the Articles. The change allows an insolvent person to act as a director. 
• The company must lodge the resolution and the new articles at Companies House.

This might sound daunting. However in reality it is actually a relatively simply process – particularly if you are the sole director and owner/shareholder of the company.

Whether you need make changes to your company Articles or not will depend on when the company was set up. In some cases, the Articles will not have to be amended.

How will your company be affected if you start an IVA

Where you are a company director and start an IVA, your company will not be directly affected. However, there are some potential implications that you should be aware of.

Company debts

You can’t include company debts in your IVA.

If your company has debt, it will need to continue maintaining the payments towards this.

As a director, you may have given a personal guarantee to pay the debts if the company can’t. Where this is the case, you should make this known to your IVA company. You should list these as potential debts in your Arrangement

If the company is subsequently unable to maintain its payments you would then become personally liable. This could result in the failure of your IVA unless a provision for the guarantee has been included.

If your company is struggling to pay its debts, an IVA will not resolve this issue. You need to consider a company debt solution such as liquidation.

The company bank account

Starting an IVA might have implications if you include personal debt owed to the bank where you also have your company account.

In these circumstances, the bank will become aware that you as an individual are in financial difficulty.

In the case of smaller companies (especially owner director companies), this might lead the bank to withdraw company credit facilities.

The reason for this is that the bank can become concerned (rightly or wrongly) that if the director of the business is in financial difficulty, then the company might also be in trouble. This is due to the closely linked nature of the company and director’s finances.

Are you a company director and struggling with your personal debt? Contact us today for expert advice on whether an IVA is the right solution for you.

Company director and IVA Case Study – Joe’s story

We assisted Joe to start his IVA in October 2025. Joe is a plumbing and heating engineer who runs his business through a limited company.

Over a period of time and due to various reasons, Joe’s personal debts had reached well over £10,000.

He had considered the option of a debt management plan. However, he owed money to HMRC. With a surplus income of just £100/mth, he was unable to meet their requirement of full repayment within 2 years.

Bankruptcy was not an option for Joe as it would have meant him resiging as a director and closing his company. He did not want to do this as his business had started building a name for itself in his local area.

An IVA was therefore the ideal solution. Joe’s IVA was accepted based on monthly payments of £100. He continues to act as a director of his company.

As a company director, can you own shares if you do an IVA?

There is nothing to stop you owning company shares when you are in an IVA.

You will certainly be a shareholder if you are the owner director of your business.

Once your IVA starts, your shares remain in your ownership. They do not transfer to anyone else.

This is because under normal circumstances the shares are likely to have little or no value. As such they do not have to be highlighted as assets in your Arrangement.

Do company shares need to be highlighted in your IVA?

You only need to list shares as an asset in your IVA if they have a saleable value.

An example of this would be where you own shares in a listed company. Such shares have a known value and as such, you could sell them.

The shares you have in your own company do not have to be included. This is because they are unlikely to have any immediate value.