Overview
- Begbies Traynor’s Red Flag Alert recorded 67,369 companies in critical financial distress in Q4 2025, a 44% year‑on‑year increase.
- Hospitality showed the steepest deterioration, with hotels up 54% in critical cases and bars and restaurants up 39% over the past 12 months.
- The firm cautions that HMRC’s move to collect about £27 billion in overdue corporation tax, PAYE and VAT could trigger further failures in 2026.
- Recent administrations at The Original Factory Shop, Claire’s Accessories and Revolution Bars owner The Revel Collective highlight mounting strain in retail and leisure.
- Distress is heaviest in London (20,314) and the South East (11,083), with the Midlands at 7,969, as higher employer costs, weak demand and elevated interest rates pressure smaller firms.