IVA for five

I act on behalf of a self-employed shopkeeper who is continuing in business; however in March 2011 he took out an individual voluntary arrangement (IVA) for both personal and business debts. He has agreed to repay £0.40 in the pound over a period of five years. His financial year end is
31 March.

I would very much appreciate any comments as to how the business liabilities should be shown in the annual accounts in the future.

Furthermore can readers advise on the taxation implications of the IVA concerning the amount of business debts which will not be repaid?

Query 17 895 – Eva

Reply from Sarah Gain

Starting with the accounting aspects of your query in the accounts the accounting treatment for the outstanding liabilities will depend upon whether the individual voluntary arrangement...