Reports from the hospitality sector have shown a significant increase in the number of pubs closing, amidst challenging circumstances. The research data is based on a year-on-year comparison of the number of insolvencies for pub firms and it shows a 180% increase in the last 12 months.
It may not be a question that you thought you’d have to ask yourself, but as a Director, part of your legal undertaking requires you to ensure that the business remains solvent and trades within its means. Operating outside of these boundaries could see the company being declared insolvent, struck off and you, as a Director, being penalised or disqualified – meaning you cannot be a Director again.
The number of companies collapsing into insolvency towards the end of 2022 increased significantly. Having already seen 1,948 businesses closing down in October, the November figure was even higher with 2029 shutting up shop. As well as showing an increasing trend for the year, these figures also represent an alarming jump year-on-year and also when we look back to pre-pandemic statistics.
If your business is, or becomes, insolvent you must act with care to avoid wrongful or fraudulent trading. Here we explore the differences and implications of each.
The Insolvency Service has reported that corporate insolvencies are up by more than two-thirds on this time last year as economic pressures continue to rise. Up 67% on the same time last year, the July figures also show that the overall rate of insolvencies is up 27% compared to 2019.
Company directors considering an insolvency process need to be aware of recently introduced legislation, contained within the Finance Act 2020. The new law has been designed to combat the use of insolvency as a means of avoiding tax liabilities.
The Government is working on new legislation to try and stop company Directors using dissolution through strike off as a means of avoiding repayment of liabilities – notably government-backed funding, such as CBILS or Bounce Back Loans. The new law which has had its first reading in Parliament, looks set to become law later this […]