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Insolvency is rising but the self-employed bankruptcy count is unpublished

ended 21. September 2026

In August 2026, 11,644 people entered insolvency in England and Wales, 2 per cent fewer than in July but 3 per cent more than a year earlier. Of those, 725 were bankruptcies, up 14 per cent on August 2025. One in 360 adults in England and Wales entered insolvency in the year to 31 August 2026, against one in 408 the year before.

The Insolvency Service has not updated how many bankrupts work for themselves since January 2026. A new case management system, live since 1 November 2025, delayed the recording of trader status, so the sections on bankruptcies by self-employment status and industry were left out again on 18 September. Updated numbers last appeared in the December 2025 release, published in January 2026, and ran only to October 2025. Eight monthly releases on, the Service aims to resume the self-employment figures in the coming months, and will report progress by December 2026. Self-employed bankrupts are missing from the published count.

A sole trader has no company standing between them and the tax bill. Incorporated, the debt is usually the company's. Unincorporated, the Self Assessment bill is theirs, so a bad trading year can end in bankruptcy, which stays on a credit file for six years from the order.

  1. Is it acceptable for accredited official statistics to run eight releases without updating how many bankrupts were self-employed, as insolvency rises?
  2. Are self-employed applicants already harder to place? Is it fair that a group with little protection from a bad year is the one the published figures no longer count?
  3. Have you had a self-employed client whose business debt turned into a personal insolvency, and what did it do to their borrowing? Please give as much detail as you can.

6 responses from the Newspage community

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Harvey DhillonVerified
Founder & CEO at Zmartly
The missing self-employment line isn't a footnote. It's the only official read on how business failure lands on someone trading in their own name, because the published figures record self-employment in the bankruptcy tables. Company collapses are counted in a separate release, so when a sole trader goes under it shows up as a personal insolvency, with nothing on the record to say a business failed at all. Bankruptcy is also the route rising fastest, up 14 per cent on last August, so we've gone blind on the number that's moving. The sole traders we see struggling show it in the VAT return long before any court does. The Insolvency Service moved to a new case management system last November. Calling this a delay is generous, and until it's fixed nobody setting debt advice or business support for sole traders can tell how much of that rise is theirs.
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Nouran MoustafaVerified
Practice Principal & IFA at Roxton Wealth
The missing data matters because “self-employed” is too often treated as shorthand for “higher risk”, when the reality is far more nuanced. Eight months without updated figures means advisers, lenders and policymakers are discussing that risk with an important part of the picture missing.

From a mortgage perspective, self-employed applicants are not automatically harder to place. Strong accounts, sustainable profits and sensible borrowing can make them perfectly straightforward cases. The difficulty comes when a bad trading period creates personal liabilities, particularly for sole traders where there is no company separating business debts from the individual.

Bankruptcy changes things significantly. Lender choice can reduce sharply, although options may return over time depending on discharge, deposit, circumstances and the wider credit profile. The distinction matters: being self-employed is not adverse credit; experiencing insolvency is.
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Tony RedondoVerified
Founder at Cosmos Currency Exchange
Incompetence or gaslighting? Under the UK Statistics Authority Code of Practice, official statistics must be transparent and high quality. Pausing releases for the INSSight case management move is formally compliant, the disclosures were public, but eight releases without self-employed bankruptcy figures as insolvencies rise leaves policymakers and advisers blind. Or conveniently so, for a government that talks up "growth in every postcode" then throttles business with £80bn of tax rises and a mountain of regulation, the Employment Rights Act included. Sole traders carry the risk: unincorporated debts, HMRC Self-Assessment bills included land on the individual with no limited liability shield. Lenders treat the self-employed warily with multi-year SA302s, bigger deposits. Lose one main client and a contractor can't cover tax and supplier bills and bankruptcy follows: assets liquidated, accounts closed, six years on the credit file, mortgage disclosure for life.
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Tony SanchezVerified
Founder at Bridging Loan Directory
Self-employed bankrupts are still included in the overall total. What is missing is the breakdown showing how many there are. Eight releases without it leaves a significant blind spot, but missing data is not evidence that self-employed borrowers are becoming riskier.

For property borrowers, the practical concern is the exit. Weaker earnings or damaged credit can reduce the mortgage available to repay a bridging loan. A bridging loan can buy time; it cannot make an unaffordable refinance affordable.

We need a firm timetable for restoring the figures and evidence from actual lending decisions before claiming self-employed applicants are becoming harder to place.
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Darryl DhofferVerified
Founder at The Mortgage Geezer
The Insolvency Service’s failure to track self-employed bankruptcies for eight months is a blind spot policymakers cannot afford. Sole traders shoulder unlimited personal liability, one bad quarter transforms a tax bill into catastrophic personal debt. While limited companies offer structural protection, unincorporated workers face direct financial ruin, with a bankruptcy order crushing their borrowing power for six years. Leaving this vulnerable group uncounted conceals the real human toll of rising insolvencies across England and Wales. Lenders are tightening criteria, and without accurate official data, viable entrepreneurs are penalised alongside struggling trades. We urgently need systemic transparency, not another delay until winter.
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Dariusz KarpowiczVerified
Director at Albion Financial Advice
Eight releases without the self-employed breakdown is a serious gap in accredited statistics, and it comes while bankruptcies are up 14 per cent in a year. Sole traders carry the whole risk. No company sits between them and the Self Assessment bill, and one bad year can put a bankruptcy order on their file for six years.

You cannot advise, lend or set policy when the most exposed group is missing from the count. A promise of progress by December is not a timetable. The Insolvency Service should name a firm date and restore the figures well before the year is out.