There were 1,931 corporate insolvencies in July 2026. This was an increase of 4.5% compared to June 2026 (1,847) and a 4.9% decrease compared to July 2025 (2,031).
Chris Tate, Restructuring and Insolvency Partner at international accountancy and business advisory group Azets, which has offices in Maidstone, Ashford, Canterbury, Sandwich and Sidcup, says: “For an increasing number of firms, July was the month where the cost of doing business became too heavy.
“In a climate where expenses continue to rise and debts continue to be chased, an increasing number of directors ran out of road and more businesses ran out of time and options.
“The main driver of July’s rise in corporate insolvency numbers was Creditors’ Voluntary Liquidations, which rose to the second highest number this year, and a small increase in Compulsory Liquidations. Administration numbers were also down month-on-month, which shows rescue was an option for fewer firms by the time they sought insolvency advice.
“While numbers are lower this month than they were a year ago, we should remember that July 2025’s figures reflected the impact of the increases in National Minimum Wage and Employer National Insurance, which resulted in a rise in insolvencies as businesses found themselves unable to absorb those increased costs after years of soaring expenses and shrinking margins.
“Corporate insolvencies continue to be driven by a mixture of high costs, cautious consumer and customer spending, political and geopolitical uncertainty, and creditor aggression. Businesses are operating in a world where everything costs more, people are spending less, and creditors are turning to the courts if bills are paid late. This is leading to more of them seeking advice and support with their financial and cashflow issues.
“HMRC has been assertive in chasing down overdue tax debts and has used winding-up petitions to force payment of overdue bills for some time now. However, they have increased their use of this in recent months in an attempt to more aggressively recover funds for the public purse. Private sector creditors have followed suit and are now going after debts with a ferocity that is driven by fear of facing the same cashflow issues and pressure from those they owe money to.
“Many directors are running out of options, ideas and energy and are choosing to close down their businesses. This is because they don’t have any alternative options and they don’t believe the situation can or will improve enough in the short-term for them to turn things around.
“The change of Prime Minister and the ongoing effects of the conflict in the Middle East have hit incomes, hiring and confidence hard. This is affecting borrowing costs and availability at a time when many firms are in need of rescue finance to allow them to trade through challenging times.
“There has been some good news in the retail industry in recent weeks, but sales increases are based on volume rather than value. With online shopping growing at the expense of traditional retail stores, and hot weather pushing up energy bills as businesses try to keep shoppers cool, margins remain tight at a time when retailers badly need a financial shot in the arm.
“We’re hearing the residential property sector is struggling as the housing market has declined and companies that based their business models on prices increasing find themselves overloaded with debt. With flats, in particular, struggling to sell and losing value in some parts of the country, this is hitting property companies hard and pushing them into the red.
“The construction sector is also continuing to struggle with increased wage bills, shrinking margins, delays in projects starting and legacy contracts whose slim profits have eroded to the point they become losses.
“Firms who survived and even made a profit on these kinds of arrangements historically are now seeing these slim margins eroded to the point where they have no alternative but to seek the support of insolvency specialists as their business models has become unsustainable.
“Anyone who is worried about their finances should speak to a restructuring or insolvency advisor as a priority. We know how hard it is to talk about, but having the conversation as early as possible can ensure that Directors maximise their potential options.
“More time to consider and make robust decisions is crucial and usually leads to better outcomes than if you’d waited until the situation became more serious and the options more limited.”
Before you go…
➡️ Have you added your business to the Kent Business Directory yet? - https://kentbusinessdirectory.co.uk
➡️ Don’t miss the latest networking events near you - https://www.kentbusinessevents.co.uk
➡️ Do you have news or announcements you’d like to share about your business?
Contact us today - [email protected]
If you enjoyed this article, please subscribe and pass it on to another Kent business owner who might also like it! Thanks.
