Businesses choosing to voluntarily close has reached a new high as the long-term impact of coronavirus restrictions and concerns over imminent tax hikes hits business owners.

Research by Price Bailey shows that a record 14,526 businesses in Britain voluntarily appointed liquidators last year, with this marking a 7% increase on the previous record set in 2020 when 13,590 companies voluntarily appointed liquidators.

Analysis shows that fewer than 10,000 businesses opted to close in 2019, with support initiatives such as the furlough scheme and bounce back loans helping keep SMEs going amid the pandemic. P

Price Bailey has warned that the 1.25% increases in National Insurance and dividend tax rates set to come into force in April may prompt further voluntary liquidations.

Matt Howard, Head of Insolvency & Recovery at Price Bailey said “Successive governments have chipped away at the tax advantages of running a business to the point where business owners are deciding that the risks outweigh the potential rewards.”

“We may well see a flood of voluntary liquidations ahead of April’s tax rises.”

Source:  Credit-Connect