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Rise in company insolvencies

ended 19. May 2026

The number of registered company insolvencies in England and Wales was 2,085 in April 2026, 2% higher than in March 2026 (2,037), and 3% higher than the same month in the previous year (2,028 in April 2025), according to official data published this morning. Meanwhile, in April 2026, 10,920 individuals entered insolvency in England and Wales. This was 10% lower than in March 2026 but 7% higher than in April 2025.

What do you consider to be the main reasons for the continued rise in business and individual insolvencies relative to a year ago? And do you expect the numbers to continue to rise? Also, to what extent is the government responsible for the rise in company insolvencies? Any other thoughts, ASAP please.

3 responses from the Newspage community

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Editor
Tony Redondo
Founder at Cosmos Currency Exchange
There will be a fresh bout of TDS (Trump Derangement Syndrome) from Reeves, and this Labour government and this government are not responsible for the global economic weather, such as trade protectionism or energy shocks, but they are solely responsible for the domestic vessel navigating it. By simultaneously raising the floor on operational costs (wages and regulations) and keeping the ceiling high on taxation, fiscal policy has left thin-margin enterprises with almost no buffer to survive the macro turbulence of 2026. Insolvencies are highly likely to continue to trend upward for the rest of 2026. UK Monetary Policy is Stuck, and hopes for an aggressive cycle of rate cuts this year have vanished. As economic growth slows to a projected sub-1% for the year, this lack of momentum will force more marginalized firms into liquidation
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Martin Rayner
Financial Adviser at Compton Financial Services
Yearly trends matter far more than monthly fluctuations and the direction is clearly negative. Businesses are being squeezed from every angle at once: higher employer National Insurance, rising minimum wage costs, more employment regulation and an increasing overall tax burden, all while consumer demand remains fragile.

Businesses can normally adapt to isolated cost increases. The problem is the relentless layering of extra costs and regulation, which steadily drains cashflow and leaves little room for error.

There is a major difference between taxing profits and increasing operating costs. Higher corporation tax simply reduces profitability. Rising staffing and compliance costs can turn otherwise viable firms into loss-making businesses and force closures. Unless there is a meaningful shift towards a more business-friendly environment, insolvencies are likely to keep rising through 2026 and beyond.
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Colette Mason
AI Ethics Consultant at Clever Clogs AI
April was the month everything the government announced actually hit the payroll. Employer NICs at 15% on a £5,000 threshold, the business rates revaluation, the end of retail and hospitality rates relief, minimum wage increases, all landing in the same month. Company insolvencies rose 3% year on year, but the number that matters is compulsory liquidations running 24% above the 12-month average. That's creditors forcing the issue, not directors choosing to wind down. The government loaded the costs onto employers in the Autumn Budget and employers passed them through in the only ways available: fewer hours, fewer hires, fewer pay rises. Whether insolvencies keep climbing depends on whether consumer spending recovers before the next round of fixed costs arrives. Right now, retail sales are falling, hiring is stalling, inflation is set to rise and the businesses absorbing these costs have no margin left to absorb the next ones.