Business news 23 December 2025

UK businesses face a challenging mix of slowing economic growth, rising tax pressure, fragile consumer demand and continued insolvency risk as 2025 draws to a close. While global markets are buoyant on year-end optimism and rate-cut expectations, the domestic picture remains tight for SMEs — particularly those selling on credit — with cashflow pressures building beneath the surface.

James Salmon, Operations Director.

Economy & Tax

UK growth revised down again

The ONS has revised UK Q2 growth down to 0.2% from 0.3%, while Q3 growth remained weak at 0.1%. Real household disposable income per head fell 0.8% in Q3, following zero growth in Q2 and a contraction earlier in the year. Economists expect another sluggish year in 2026 despite rate cuts.

Why it matters for credit sellers:
Slower growth usually means longer payment cycles, weaker demand and a higher risk of late or missed payments.

Household incomes hit by tax hikes

UK household disposable income has fallen to its lowest level since before the pandemic. A £6bn quarterly rise in taxes — driven by frozen income tax thresholds and higher capital taxes — more than offset wage growth. Nearly 9 million people are expected to be paying higher-rate tax by the early 2030s.

Why it matters:
Households under pressure cut spending first, directly impacting SMEs’ revenues and ability to collect outstanding invoices.

Wealthy residents continue to leave the UK

Mohamed Mansour, a major Conservative donor, has shifted his tax residency to Egypt amid sweeping UK tax reforms. He follows other high-net-worth individuals relocating overseas as taxes rise on wealth and income.

Why it matters:
Capital leaving the UK can weaken investment, confidence and demand across supply chains — including SMEs supplying larger firms.

Consumer & Retail

Britons cut Christmas gift spending

Over half of UK consumers say they are buying fewer Christmas presents this year, with many also hosting fewer guests or staying home to save money. While total Christmas spending is forecast to rise, the increase is driven by inflation rather than volume.

Why it matters:
Lower volumes mean tighter margins for retailers and suppliers, increasing the risk of delayed payments after Christmas.

LK Bennett explores accelerated sale

High-street fashion brand LK Bennett is working with advisers on a potential accelerated sale. The loss-making retailer previously entered insolvency proceedings in 2019.

Why it matters:
Suppliers should monitor exposure closely — distressed retail processes can move quickly, often leaving unsecured creditors exposed.

Rural pubs warn tax rises threaten survival

Business rates are set to rise by around 15%, adding roughly £1,400 per pub next year and potentially £7,000 by 2028/29. Industry bodies warn this could push many rural pubs over the edge.

Why it matters:
Hospitality remains a high-risk sector — credit limits and payment terms should be reviewed carefully.

Employment & Workforce

Tax breaks urged to keep over-60s working

A House of Lords committee has called for targeted tax incentives to encourage over-60s to remain in or return to work, arguing this would ease labour shortages and pressure on public finances.

Why it matters:
Labour availability affects productivity and delivery timelines — both critical for maintaining cashflow.

Tech hiring surges despite wider job market weakness

Despite rising unemployment elsewhere, 56% of UK businesses plan to expand tech teams in the first half of 2026, according to Robert Half.

Why it matters:
Digital investment continues, but skills shortages may push costs higher and strain SME budgets.

Trade & International Business

UK firms struggle to grow EU sales

A BCC survey shows 54% of UK exporters believe the post-Brexit trade agreement has not helped EU sales. Businesses are calling for customs simplification and better VAT co-operation.

Why it matters:
Cross-border friction increases costs, slows payments and raises the risk of disputed or delayed invoices.

Dyson family shifts capital overseas

James Dyson’s family investment firm has transferred at least £624m from a UK entity to Singapore as part of a wider restructuring and succession plan.

Why it matters:
Large corporates reorganising abroad can affect UK suppliers’ payment security and contract continuity.

Transport, Technology & Regulation

Robotaxi race heats up in London

Uber and Lyft plan to test self-driving cars built by China’s Baidu in London next year, joining Waymo’s existing plans. All projects remain subject to regulatory approval.

Why it matters:
Disruption is coming, but regulation may slow rollout — SMEs should plan for gradual change, not immediate transformation.

Zipcar to exit the UK in 2026

Car-share firm Zipcar will leave the UK due to rising insurance costs, flat demand and the expense of running an electric fleet.

Why it matters:
Rising operating costs continue to force exits — a reminder that even established service models can become unviable quickly.

Markets & Finance

Global markets rally, UK lags

Global equities extended their record-breaking run, led by the US and Asia, while the FTSE 100 underperformed. Investor sentiment has improved as year-end buying accelerates.

Why it matters:
Strong markets do not automatically translate into better trading conditions for SMEs — especially domestically focused firms.

Gold and silver hit fresh record highs

Gold has now broken records on around 50 occasions this year, driven by rate-cut expectations and geopolitical tension. Silver has also reached new highs.

Why it matters:
Rising gold prices often signal economic uncertainty beneath the surface, despite strong equity markets.

Pound strengthens, rate cut optimism questioned

Sterling has strengthened against both the dollar and euro. However, front-end gilt yields suggest traders are sceptical about further rapid Bank of England rate cuts after the latest reduction.

Why it matters:
Borrowing costs may remain higher for longer than many SMEs expect — refinancing plans should be reviewed carefully.

Insolvency Watch

Appointments of Administrators

  • Contract Solutions (Grampian) Ltd
  • Ickenham Travel Group Ltd
  • Indivus Ltd
  • Lune Valley Timber Buildings Ltd
  • Richard House Trust
  • Sliders UK (Doors & Windows) Ltd
  • Sprintshift Commercial Vehicle Hire Ltd
  • Titchfield CD Ltd
  • Trenport Property Holdings Ltd
  • Vynova Runcorn Ltd

Appointments of Liquidators

  • A Company of Wild Things Ltd
  • Achieve Connect
  • Afghan Bazaar Ltd
  • Alpha Plus Education Ltd
  • Alpha Plus Schools Ltd
  • Anthemis Group Operations Ltd
  • Barnsley House Properties Ltd
  • Bell Drive Hamilton Ltd
  • Birmingham Wheels
  • Cambridge Flow Solutions Ltd
  • CEPF II Meteor Developments Ltd
  • Ditzy Holdings Ltd
  • Edmond de Rothschild Capital Holdings Ltd
  • Environmental Instruments Ltd
  • E H Properties Ltd
  • Fitzrovia Restaurant Ltd
  • Fordath Ltd
  • Formidable Labs UK Ltd
  • Freshly Cut Ltd
  • Henport Trading (UK) Ltd
  • Iyuno UK III Ltd
  • Jane Keenan Consulting Ltd
  • Jaytail Ltd
  • Keane Construction (Midlands) Ltd
  • Koris365 North Ltd
  • Land and Water Resource Consultants Ltd
  • Lucky Enterprises Group Ltd
  • Neles UK Ltd
  • NMI UK Holdco Ltd
  • OH2GO Occupational Health Ltd
  • Procure Superabrasives Ltd
  • Prof Roger Van Riet Ltd
  • Provident Financial Group Ltd
  • Rahoy Estate Ltd
  • RMClarke Ltd
  • Shell Caribbean Investments Ltd
  • Southwood Boatmen Ltd
  • Thameswey Maintenance Services Ltd
  • Thameswey Solar Ltd
  • TJ Investment Property Ltd
  • Tony Stewart Agencies (UK) Ltd
  • Vamed Management and Service UK Ltd
  • Vanquish Holdco Ltd
  • Walter Operations UK Ltd
  • Wenridge Ltd
  • Westbourne 7 Ltd
  • Westbourne 8 Ltd
  • Wilkins Kennedy LLP

Petitions to Wind Up

  • Asterix Group Ltd
  • C&S Joinery (Scotland) Ltd
  • Deviate Cycles Ltd
  • DL Hudson Ltd
  • Excel Bespoke Composite Doors Ltd
  • Greenteck Global Ltd
  • IWH London Ltd
  • MG Greenheat Renewables Ltd
  • Mulders Brothers Ltd
  • Newark Castle Line Ltd
  • Plus234 Ltd
  • Rektron AQ Ltd
  • Roundcircle Ltd
  • Sooqy Ltd
  • Sud Horeca Ltd
  • TGCL Ltd

CPA Insight

With growth slowing, taxes rising and insolvency risk elevated across multiple sectors, credit control is becoming a front-line survival tool, not a back-office function.

If you’re extending credit into 2026:

  • tighten payment terms,
  • monitor customers more closely,
  • and act early when accounts slip.

Prevention is cheaper than recovery.

Just call Peter Uwins, CPA’s National Sales Manager, on️ 020 8846 0000 (business hours) or email nsm@cpa.co.uk today.

When you see your money come in, you will be so glad you used CPA.

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economic