Truro accountant: firms “running out of road and time”

More companies across England and Wales went under last month than the month before, and the accountant who spends his working week untangling the fallout says the pattern behind the numbers is becoming familiar. Rising bills, slow-paying customers and creditors who have stopped waiting are, he says, leaving fewer directors with anywhere left to turn.

The numbers behind the rise

There were 1,931 corporate insolvencies in July 2026 across England and Wales, up 4.5% on June’s total of 1,847. That is still down 4.9% on the same month last year, when 2,031 companies went under.

Andy McGill, restructuring and insolvency partner at accountancy and business advisory group Azets, which has an office in Truro, says July was the month the cost of doing business became too heavy for a growing number of firms.

“For an increasing number of firms, July was the month where the cost of doing business became too heavy,” Andy said. “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 rise was driven mainly by Creditors’ Voluntary Liquidations, which climbed to the second highest monthly total this year, alongside a small increase in Compulsory Liquidations. Administration numbers, by contrast, fell month on month.

“Administration numbers were also down month-on-month, which shows rescue was an option for fewer firms by the time they sought insolvency advice,” Andy said.

He pointed out that July 2025’s higher figure had its own explanation, tied to the increases in National Minimum Wage and Employer National Insurance that hit businesses that year after years of rising costs and shrinking margins.

Costs, creditors and an unforgiving climate

Andy described a mix of pressures now converging on company directors: high costs, cautious spending from consumers and customers, political and geopolitical uncertainty, and creditors who are no longer prepared to wait.

“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,” he said. “This is leading to more of them seeking advice and support with their financial and cashflow issues.”

HMRC has been among the most assertive creditors, he said, using winding-up petitions to recover overdue tax debts, and has stepped up that approach in recent months. Private sector creditors, he added, have followed HMRC’s lead, chasing debts more aggressively out of fear they will otherwise be left exposed.

“Many directors are running out of options, ideas and energy and are choosing to close down their businesses,” Andy said. “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.”

He also linked the pressure to wider events, including the change of Prime Minister and the ongoing conflict in the Middle East, both of which he said were affecting incomes, hiring, confidence and the cost and availability of borrowing at a time when many firms need rescue finance to trade through.

The sectors under the most strain

Retail has seen some encouraging headlines recently, Andy said, but the improvement is built on shoppers buying more, not spending more. With online shopping continuing to draw trade away from physical stores, and hot weather pushing up energy bills as retailers try to keep customers cool, margins remain stretched at a time when many need a financial lift.

The residential property sector is also under pressure, he said, as a weaker housing market catches out companies whose business models depended on rising prices. Flats in particular are proving hard to sell and are losing value in some parts of the country, a combination that is pushing property firms into the red.

Construction is facing a similar squeeze, with rising wage bills, thinning margins, delayed project starts and older contracts whose once-slim profits have eroded into 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 model has become unsustainable,” Andy said.

What Azets is telling worried directors

Andy’s advice for business owners who are worried about their finances is to speak to a restructuring or insolvency advisor as early as possible.

“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,” he said. “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.”

Azets has an office at Woodlands Court on Truro Business Park, part of a wider network of 9,000 local experts across 190 locations in eight countries, advising more than 100,000 clients on their financial and business needs.