Corporate insolvencies fall in June 2025

Corporate insolvencies in England and Wales dropped significantly in June 2025, according to new government figures, offering a temporary reprieve from the financial pressures that have plagued businesses over the past two years.

A total of 2,043 company insolvencies were registered, marking an 8.4% decrease from May 2025 (2,230) and a 15.9% fall compared to June 2024 (2,430). The figures also represent a 1.6% decrease from June 2023 (2,077).

This is the lowest June insolvency total since 2022, suggesting that some businesses may be regaining a foothold, or at least pausing formal insolvency action, amid slightly improved trading conditions.

The monthly decline in company insolvencies was driven largely by fewer Creditors’ Voluntary Liquidations (CVLs) and administrations. There were 1,585 CVLs, 332 compulsory liquidations, 111 administrations, and 15 Company Voluntary Arrangements (CVAs).

No receivership appointments were recorded. While the number of compulsory liquidations fell 6% from May 2025, they remained above both last June’s figures and the 2024 monthly average, reflecting more aggressive debt recovery efforts by creditors, especially HMRC.

“The number of corporate insolvencies fell in June, reaching their lowest level for this month since 2022. However, this may simply 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.”

He warned that rising compulsory liquidations, particularly those pursued by HMRC, suggest creditor patience may be wearing thin.

Despite the positive insolvency data, economic confidence remains fragile. Russell noted: “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.”