Insolvency practitioners have seen growing demand for advice on 'members voluntary liquidations' as directors at firms take precautionary action ahead of this week’s budget.
Hayley Watson, Eastern chair of insolvency trade R3, said: “Of particular concern is the impact of future tax rises, and R3 members are telling us that there’s an increased demand for support around member voluntary liquidations as directors take steps to reorganise their business and its finances ahead of any changes announced in the Budget.”
A members’ voluntary liquidation is the formal process to bring a solvent company to a close. “Across the wider local economy …the business climate remains difficult as almost every firm faces a multitude of issues, including ongoing cost challenges and uncertainty around announcements in the Budget,” she said.
But R3 says a rise in company insolvencies in England and Wales does not reflect the 'seeds of recovery' which are beginning to germinate in the East Anglia economy.
“Although corporate insolvencies have risen by a small percentage compared to last month, there have been some positive indications for the local marketplace, with construction output increasing, retail sales volumes continuing to rise in August and consumers spending more in the hospitality sector in September,” said Hayley Watson. Insolvency Service figures show corporate insolvencies rose to 1,973 in September, up 1.5 per cent on August but 7.4 per cent down on September last year.