The Insolvency Service publishes the number of insolvencies in England & Wales each month, separated into the 4 types of insolvency:
- Voluntary liquidations (CVL)
- Compulsory Liquidations
- Administrations
- Company Voluntary Arrangements (CVA)
These numbers can be seen in the graph below:
Insolvency Statistics Graph
CVL is Largest Type of Insolvency
By far the largest type of insolvency is the Creditors’ Voluntary Liquidation (CVL). This is where directors and shareholders have agreed to place the company into liquidation voluntarily and have passed the necessary resolutions.
A Compulsory Liquidation is where a creditor makes an application to the courts for a company to be wound up, and the Official Receiver appointed Liquidator. HMRC are by far the largest petitioning creditor with over 1,000 applications each year. More information on compulsory liquidations can be found at Compulsory vs Voluntary Liquidation ‐ What’s the Difference?
Administrations and Company Voluntary Arrangements are less frequently used but important tools for saving a business in the appropriate circumstances.
