Credit, Collections & Insolvency News
Latest figures from the Insolvency Service have shown that the number of registered business insolvencies in England and Wales decreased by 8.4% to a total of 2,043 in June compared to May 2025’s total of 2,230, and decreased by 15.9% compared to June 2024’s figure of 2,430.
The business insolvencies consisted of 332 compulsory liquidations, 1,585 creditors’ voluntary liquidations (CVLs), 111 administrations and 15 company voluntary arrangements (CVAs). There were no receivership appointments.
CVLs accounted for 78% of all company insolvencies. The number of CVLs decreased by 8% from May 2025 and was 18% lower compared to the same month last year (June 2024). In the first six months of 2025, CVLs have been at a similar level to the 2024 monthly average.
The number of compulsory liquidations in June 2025 was 6% lower than May 2025, but 13% higher than in June 2024 and 23% higher than the 2024 monthly average.
The number of administrations in June 2025 was 18% lower than in May 2025 and 35% lower than in June 2024. In the first six months of 2025, administrations have been slightly lower than the 2024 monthly average.
The number of CVAs in June 2025 was 7% higher than in May 2025, but 35% lower than in June 2024. Numbers remain low compared to historical levels. CVAs are not seasonally adjusted due to low volumes.
Tom Russell, President of R3, the UK’s restructuring, turnaround and insolvency trade body, and a Licensed Insolvency Practitioner and Director at James Cowper Kreston, said “The number of corporate insolvencies fell in June, reaching their lowest level for this month since 2022. The yearly decline has been driven by a drop in the number of Creditors’ Voluntary Liquidations (CVLs) and Administrations, alongside a slight fall in Company Voluntary Arrangements (CVAs). Whilst a single month of data does not indicate a long-term trend, it may signal that some directors are holding back from taking formal action for now, either due to improvements in trading conditions or in the hope that the summer months bring a significant boost.
“Compulsory Liquidations, however, have risen compared to June last year and remain significantly above pre-pandemic levels. This reflects a growing willingness among creditors to pursue debts through the courts – led by HMRC, which continues to take a more assertive approach to recovering money for the public purse.
“Whilst a fall in formal corporate insolvencies is welcome, the broader economic mood remains subdued. Businesses and households alike are low in confidence and as a result key decisions are on hold as a ‘wait and see’ attitude is adopted. With GDP growth declining for the second month in a row in May and unemployment levels recently increasing, it remains to be seen whether this negative economic trend will continue.
“Uncertainty around tariffs continue to be a concern. Whilst the recent UK-US trade agreement is a welcome development for some exporters, it is not a transformative deal for the wider economy. Speculation about tax increases in the autumn is also adding to the sense of uncertainty. For business owners trying to plan, hire and invest, not knowing whether or when further cost increases are coming makes decision-making far more difficult. Many feel stuck in limbo – unable to move forward confidently without a clearer view of what lies ahead.
“This lack of confidence is playing out across several key sectors. Retail sales fell sharply in May as consumers pulled back on non-essential spending, while significant job losses in the hospitality sector point to mounting financial strain, with staff cuts often a last resort for businesses trying to stay afloat. Increases to the National Minimum Wage and National Insurance have intensified financial pressures, causing many firms to leave vacancies unfilled. Many will be hoping for a strong summer, but there is no guarantee that better weather and increased footfall will be enough to tip the balance.
“Construction output fell in May, and businesses on the ground are reporting a slowdown as house prices growth levels off. Some of that oversupply reflects landlords leaving the market as a result of legislative changes, but the broader issue is one of weakening demand and low confidence. In a buyer’s market, developers will be reluctant to build into falling prices, and for a sector that already works on tight margins, that hesitation is adding real pressure.’
Giuseppe Parla, Business Recovery Director at Menzies said “Despite company insolvencies falling in June, CVLs remain high (78% of all insolvencies) – suggesting that many businesses owners are calling it quits amid a turbulent economic environment. Inflation is at an 18-month high, and with the economy displaying two months of decline – we may well hear the word “Recession” before too long.
“UK Retail for instance has been hit hard, and despite the heatwave bringing sales volumes higher in June [electric fans, festivals and food sales] after a sharp drop in May – this is likely to buck an ongoing and downward trend. River Island’s proposed Restructuring Plan, the £1 sale of Poundland, and the Prax Group’s administration are already proving that an increased tax burden, changing consumer behaviours and economic uncertainties could cause the death of an essential British sector.
“Anticipated interest rate cuts could provide respite for struggling businesses, as more look to secure cheaper funding and stabilise their bottom lines. In truth however, it may prove an act of too little and too late.”
