HMRC can force a company to liquidate if it is persistently in tax arrears. The number of winding-up petitions that HMRC secured through the court surged 185pc between 2022-23 and 2025-26, according to the NAO’s analysis.
John Hood, of accountancy firm Moore Kingston Smith, said: “HMRC was reluctant during and after the pandemic to wind up companies, but the situation has changed over the past 18 months.
“HMRC has increased resources to enforce the debt and where necessary will remove companies that have no real prospect of paying their debts.”
Increases to employer National Insurance and the minimum wage following the autumn Budget in 2024 have weighed heavily on businesses, with labour-intensive industries hit especially hard.
The construction sector had the highest number of insolvencies in the 12 months to September, according to the latest figures from the Insolvency Service.
Since 2022, company insolvencies have been at their highest levels since the financial crisis. Total company insolvencies rose from around 14,000 to 25,000 between 2021 and 2023, and remained high at 24,000 in 2025.
