Insolvencies jump 43%

A jump in energy costs and insolvencies is detrimental for the retail, construction and hospitality sectors…

Startling new statistics have revealed the number of insolvent companies jumped by a staggering 43% in August 2022. Although high inflation has led consumers to reduce spending, this paints a bleak picture of the future of UK businesses.

The government finally acted by freezing energy prices to lessen the blow of the recent hike in energy bills. However, people will still be paying more than twice the amount for energy they did in recent years. This and other rising costs add further pressure on households to cut back on unnecessary spending.

The hospitality and retail sectors will suffer. It’s a similar situation in construction as consumers will probably downgrade any potential renovations.

Insolvencies jump

In addition to a jump in insolvencies, households are likely to reduce eating out and non-essential purchases. This is most likely in the run up to the festive period when there is already pressure to spend.

Businesses also face unrealistic energy costs and it’ll be some time before they receive the support the government has pledged. In the interim, many companies will become insolvent. On the 23 September, Prime Minister Liz Truss and the chancellor Kwasi Kwarteng revealed further details of their support.

Mini budget

Here are some of the key points:

  • From April 2023, the government will cut the basic rate of income tax by 1p in every £1
  • They also plan to abolish the 45% additional rate of tax paid by people earning over £150,000 annually from April 2023.
  • The proposed 1.25% rise in National Insurance will be abolished from November 2022
  • The planned Corporation Tax rise from 19% to 25% has been scrapped

It is debatable how much these measures will affect the majority of people living in Britain. But one thing is for sure, the final quarter of 2022 will make or break many businesses.

Posted in ,

Understanding the winding up petition: A crucial tool


In the world of insolvency, a winding up petition holds significant importance. When a company has received a statutory demand (SD) and fails to raise…

Read More

Urgent Call to Action: Have You Invested in Beech Holdings (Manchester) Ltd?


If you or anyone you know has invested in Beech Holdings (Manchester) Ltd, it’s time to take action immediately and get in touch. The Situation…

Read More

Bankruptcy Annulment: A Fresh Start for Financial Recovery


Bankruptcy is often viewed as a last resort for individuals overwhelmed by debt, offering a path to financial relief but also leaving a significant mark…

Read More

Castle Trust and Management Services Ltd- The Big Problem for the Gibraltar Financial Services Commission


The collapse of Castle Trust and Management Services Ltd (CTMS) has raised serious questions aboutthe role and effectiveness of the Gibraltar Financial Services Commission (GFSC)…

Read More