Britain's Insolvency Wave

Companies House publishes an "insolvency" record for every UK company that enters a formal proceeding: voluntary liquidation, compulsory liquidation, administration, or a corporate voluntary arrangement (CVA). We pulled the full insolvency-event feed and counted new cases by the year they were opened. The shape of the curve is unambiguous.

Not all of the 29,048 are distress events. About 6,680 of them in 2025 were Members' Voluntary Liquidations, which is a solvent wind-up. An MVL is a tax-driven decision by directors to close a healthy company, typically before a change in dividend or capital gains treatment. The spike in MVLs from 472 in 2021 to 6,680 in 2025 is its own story, partly driven by the 2024 fiscal year's changes to NI and dividend tax.

The other 22,368 cases are genuine distress: Creditors' Voluntary Liquidation (directors admit they can't pay), Compulsory Liquidation (court order), or administration / CVA / receivership. CVL alone accounts for 18,216 of the 2025 total, or three out of every five cases.

Group companies by the year they were incorporated, count how many of each cohort have hit insolvency since 2020, and a flat plateau appears. Companies incorporated between 2014 and 2018, the ones that built up some trading history before the COVID shock, all have a current insolvency rate of about 2.7%. Roughly 1 in every 37 companies founded in those years has now entered an insolvency proceeding.

Pandemic-era cohorts (2020 onward) are lower for a mechanical reason: they're younger, so fewer have reached the typical 3-5 year window in which insolvencies cluster. The plateau across 2014-2018 is the real signal: this is the population that took out Bounce Back loans, traded through COVID with revenues hit, and then faced higher interest rates and weaker demand in 2023-2025.

Restaurants, cafés, takeaways and pubs head the list. Food and beverage service (SIC 56) accounts for 9,718 of the post-2020 insolvent companies on the register. Specialised construction trades (plumbing, plastering, scaffolding, electricals, 8,848 cases) and retail (6,557 cases) follow. Hospitality, construction and retail together make up the rough shape of post-pandemic UK insolvency.

One sector that is notably present and notably misread is real estate (SIC 68, 4,591 cases). These are not high-street estate agents in the main; they are special purpose property vehicles wound up after the underlying transaction completed, or distressed buy-to-let landlords with stretched mortgage cover. Counting them as "insolvent businesses" is technically right and economically misleading.

The 2025 total includes 6,680 MVLs that aren't distress. Distress-only insolvencies are still up 14x from 2020, but the official UK Insolvency Service quarterly statistics use slightly different definitions than the Companies House feed and their headline number for 2025 will not exactly match this analysis. Both sources agree on the shape of the curve.

None of this is a forecast of further rises. The 2025 spike could plateau or fall in 2026 as interest rates ease and the pandemic-debt overhang clears. What the data does tell us is the size of the wave that has already happened: the UK has just experienced the largest sustained increase in company insolvencies in the modern record.