Personal insolvencies spike predicted- business news  23 July 2020.

23 July 2020.

James Salmon, Operations Director.

A spike in personal insolvencies is predicted,  The PM pledges to get the economy back on track by 2024, why are the HMRC persecuting the self employed, Covid-19 and lots more business news we have seen.

Here are CPA we want to  share the business news stories we have seen that we think will affect our members and readers. Many of us are busy fighting to protect our businesses and therefore might have missed some of the news that could impact small businesses, their owners and those that sell on credit.

Spike in personal insolvencies predicted

Trade body R3 has forecast a spike in personal insolvencies in the months running up to Christmas.

A survey of insolvency experts predict a marked rise into the end of the year.

The Survey found more than two-fifths (41.6%) of those who work in personal insolvency predict the number of people going financially insolvent in the next 12 months will be significantly higher than last year. A further 44.5% in R3’s member survey think personal insolvency cases will be somewhat higher than 2019.

Of those who expect the numbers to increase, the majority (61.5%) expect the this to happen around October to December this year. While 30.6% think the increase will take place later, between January and March 2021.

The Government has introduced unprecedented levels of support for businesses and consumers since the start of the pandemic, and a number of financial services providers have also taken steps to help financially challenged consumers, for example through offering increased forbearance and payment holidays.

This has meant that the number of people considering a personal insolvency process or asking for advice has not risen as sharply as might have been expected during the current pandemic.

However,  these support measures are temporary, and do not cover everybody. When they come to an end, a number of people are likely to find themselves in financial difficulty if their circumstances haven’t returned to what they were before the pandemic.

With  unemployment levels predicted to rise  and borrowing conditions returning to more usual patterns, the back log of delayed insolvencies could create a spike.

When asked to predict which debts or payments would be the most common immediate triggers for people seeking advice or insolvency solutions relating to their personal finances over the next 12 months, 74.2% of those surveyed cited personal debts related to business failures. 50% said credit card debt was likely to be a trigger, and 35% cited non-mortgage bank loans or overdrafts.

R3 commented “It’s not uncommon for a business insolvency to lead to an individual becoming insolvent, especially if the person in question has agreed to take on liability for a business’s debts via a personal guarantee as part of an attempt to turn it around.

“With businesses of all sizes facing difficulty as a result of the Covid pandemic, it isn’t surprising that members expect this to be a common trigger for personal insolvencies in future.

“Credit cards, loans and overdrafts are also frequent personal insolvency triggers – and are areas where banks, building societies and credit card providers have offered temporary support to consumers in the form of options like mortgage and debt repayment holidays, and interest-free overdrafts.

“These will have allowed people who have been affected by the pandemic some time to adjust, but they are only temporary, and their ending will mean people who haven’t returned to a pre-crisis financial position will struggle, which is why we expect more people to need help and support managing their finances.”

Johnson pledges to get economy back on track

Boris Johnson told MPs yesterday that he would get the economy back on an “even keel” well before the next general election in 2024. In a meeting with backbench Conservative MPs in the House of Commons, Johnson was reportedly “bullish” about covering the £200bn cost of responding to the coronavirus pandemic, provided lockdown was not lifted too quickly resulting in a spike in cases. Separately, the Government is to slash its aid budget by £2.9bn this year in line with an expected shrinking of the economy caused by the coronavirus pandemic.

Workers in the south earn 30% more but are less happy

New research commissioned by the Social Mobility Commission (SMC) suggests those who leave their home towns to work in London and the South East will earn a third more than those who stay but are likely to be less happy.

The Moving Out To Move On report also finds that those who leave to move to the South East are 50% more likely to have a degree and are more likely to end up in managerial jobs.

However, despite earning £7,000 less that those who leave, people who stay in their home towns often benefit from greater well-being and a sense of community and nearly two-thirds were homeowners, compared with 55% of “movers”.

“COVID-19 has shown that we can begin to do things differently,” says Sandra Wallace, joint interim chairwoman of the SMC, said. “Home working has been successful for many employers and for particular job roles. It has also shown that people’s views about where they want to live, and why they want to live there may be shifting. People should not have to move to prosper.”

Why are HMRC torturing the self-employed?

The Telegraph’s Janet Daley excoriates HMRC for rolling out its Making Tax Digital programme to more small businesses and individuals working for themselves.

She says it is evidence the Revenue “hates self-employed people” and regards them as “tax cheats who must be hounded, persecuted and denounced until their mode of earning a living is as thoroughly monitored as those helpless PAYE armies who have tax deducted at source.”

Daley adds that this “bureaucratic fiat” will only bring about a rise in the cash-in-hand black economy. Claims by HMRC that the move will improve productivity are bizarre, she goes on, concluding: “Coming up with new ways to torture [independent entrepreneurs], at precisely the moment when their fate is so precarious, is political and economic stupidity.”

Ashley warns of closures due to rates delay

Mike Ashley has joined other critics accusing the Government of kicking retailers in the teeth by delaying property revaluations until 2023, leaving them with business rates bills they can ill afford. Ashley’s Frasers Group said in a statement to the City that the Government had “buried its head in the sand on the critical business rates issue” and that the company must examine the “viability” of a number of the group’s stores as a result.

Pandemic rescue could end with higher taxes

The Telegraph’s Tom Rees talks to experts about how Rishi Sunak will claw back some of the cash spent on keeping the country afloat during the coronavirus pandemic.

Torsten Bell, chief executive of the Resolution Foundation, says the big economic debate “will be how much and which taxes to increase” .

Chris Sanger, head of tax policy at EY, warns: “It is only in the major three taxes that you are going to generate significant revenues that are going to result in paying back the large amounts of money that has been spent. When you have got two thirds of total revenue in income tax, national insurance and VAT those are clearly the areas that are going to have to do the heaviest lifting.”

Chilango puts sale on the menu as it prepares administration

Mexican restaurant chain Chilango is to put itself up for sale as part of an administration process. More than 1,000 investors bought £5.8m worth of mini-bonds in the chain with the promise of returns of 8% a year. But in November Grant Thornton refused to sign off the accounts and in January the company was forced to undergo a CVA. The group’s twelve restaurants are at risk along with 152 jobs.


UK airports are set to lose around £4bn in revenues according to Karen Dee, CEO of the Airport Operators Association with demand not to reach pre-pandemic levels for a considerable period.

Football caught in the UK-China freeze

As part of the freezing of relations between the UK & China, the English Premier League football matches have been taken off the air in China. CCTV, which has the rights to broadcast Premier League matches in China, won’t show the remainder of the current competition round and last nights match  match between Liverpool FC and Chelsea FC wasn’t aired as planned.


NatWest said its name had changed from Royal Bank of Scotland as planned.The change became effective today, having been registered with Companies House in Edinburgh Trading of NatWest under the updated ticker ‘NWG’ would commence from Thursday.


Transport for London enforcement officers have so far stopped 33,500 people from getting on public transport unless they put on face masks, according to the latest figures. A further 1,983 people were prevented from boarding services without masks, while 475 people were ejected from modes of transport.

Covid-19 general news

There were 279,713 new cases world wide yesterday bringing cases over 15 million with the total deaths climbing to 623,507.

All the vaccine talk has been about producing antibodies however researrch is showing that the white blood cells called T-cells are playing an important role in fighting the virus. AstraZeneca, Pfizer,  BioNTech and China’s CanSino Biologics have all hailed the presence of t-cells in vaccine recipients as a sign their experimental shots could work.

Pfizer and BioNTech announced an agreement worth nearly $2bn with the US for 600 million doses of their covid-19 vaccine.


UK stocks dropped yesterday with stocks exposed to China being particularly hit as tensions rose between the countries.

Oil prices fell on Wednesday as industry data showed a bigger than expected rise in U.S. inventories and as tensions escalated between the United States and China.

Gold prices surged to a nine-year peak on Wednesday on bets that central banks would introduce more stimulus measures to ease the economic impact of covid-19.

MPs demand action against advisers who facilitate tax evasion

The Times reports on a push by MPs to make it easier to prosecute lawyers and accountants who enable tax avoidance.

In a paper produced by a cross-party parliamentary group on anti-corruption and responsible tax, Dame Margaret Hodge, the former Labour minister and ex-chairwoman of the Commons public accounts committee, said: “The way that the law is currently set out means that it is virtually impossible to prosecute these enablers of failed tax-avoidance schemes, even when a criminal offence has been committed.”

The group said one change that could be made would be to remove the requirement for dishonest intent, which is required in all criminal fraud cases, and replace it with a “double-reasonableness” test, which is used for penalising enablers under the civil law regime. But Harry Travers, a partner at BCL Solicitors, says: “The need for the prosecution to prove dishonesty is a crucial safeguard for an accused, and should not be removed. ”

IFS: Inheritance major factor in future wealth

The Institute for Fiscal Studies (IFS) has calculated that as many as one in 10 of UK adults born in the 1980s will inherit more than half as much money from their parents as the average person earns in a lifetime.

The think tank found the median inheritance for those born in that decade is estimated to be £136,000, compared to £107,000 for those born in the 1970s and £66,000 for those born in the 1960s. People born in the 1980s had accumulated no more wealth than adults born in the 1970s had done by the same age, the IFS said, but that their parents were 40% better-off in comparison.

Robert Palmer, executive director of the campaign group Tax Justice UK, commented: “It is natural parents want to hand a legacy to their kids, but at some point we need a grown-up conversation about wealth. As we build back from the economic shock of coronavirus, politicians should use the tax system to tackle inequality and support high quality public services.”

HMRC’s modernising drive analysed

Chris Sanger, partner and head of tax policy at EY, chair of the financial secretary to the Treasury’s Tax Professionals’ Forum, and former head of business tax policy at HM Treasury analyses the key announcements from the government’s ‘legislation day’ in City AM.

He notes that Making Tax Digital (MTD) will be extended to all VAT-registered UK firms from 1 April 2022, in a bid “to reduce the scope for avoidable errors (i.e., £8.5bn of lost revenue in 2018-19) and to simplify the burden for taxpayers.”

He also suggests that “The idea that the tax status of people and businesses should be reviewed when considering licences may not be that controversial, but the idea that HMRC should be the only arbiter of determining whether someone has complied with their tax obligations is more concerning.”

CIOT boss welcomes moves to tackle loan scheme promoters

Glyn Fullelove, the president of the Chartered Institute of Taxation, has welcomed the Government’s call for evidence on tackling disguised remuneration tax avoidance, but warned that schemes targeting agency workers are continuing to operate.

Mr Fullelove said the call for evidence came out of Sir Amyas Morse’s review of the loan charge, which concluded the rules breached taxpayers’ statutory protections by applying an “unprecedented” 20-year look back period.

Mr Fullelove added: “This is a very broad call for evidence – essentially a plea from the Government for ideas on how the remaining DR schemes and other avoidance can be stopped. We look forward to engaging with HMRC and providing constructive input into how such schemes can be stopped at source.”

Don’t let Covid-19 bust your business!

It will if your cash flow dries up, either sooner or later.

The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid since 1914. We have seen many financial crises, this one will be particularly deadly for suppliers for sometime to come.

CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. Above all tactfully, because maintenance of goodwill is paramount.

To meet the needs of creditors in the current crisis, we have designed a “critical care” package especially tailored for the situation.

  • The annual package costs start at very low rates
  • A minimum performance warranty is provided
  • Several complimentary services included

Clients instruct CPA on-line via their PC or phone, completely user-friendly. Your late paying customers are told to pay you direct (not to us).

A very recent report shows a 23% increase in the number of unpaid invoices since March 11th THIS YEAR – are you getting a build-up of late payers?

 Right now, overdue accounts must be a concern and CPA has a great track record of encouraging slow-payers to pay their suppliers quickly.

It takes less than 17 minutes to see how you would benefit, do you have the time now?

No face-to-face meeting required – just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email today.

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

Do you sell on credit?

With pressures on the cash flow it is essential that you stay on top of the credit limits you grant customers and watch carefully for any late payments.

Those customers will look for the easiest option  to boost their cash-flow. Don’t let it be you.

You can’t just assume your customers can and will pay you eventually, no matter how big their name is.

It is essential to have credit management systems in place to monitor and check your customers credit worthiness.

It is also best practice to use a trusted third party like CPA to make sure you are paid on time by customers, no matter how good a name they have.

About CPA

The Credit Protection Association can help!

Formed in 1914, CPA has been providing credit management services to SMEs for over 100 years.

At the Credit Protection Association, we provide first class credit information that can help you avoid being over extended to customers who are at risk. Our monitoring service can flag up warning signs long before the end, giving you the chance to adjust and reduce your exposure. We provide recommended credit limits and credit scores on a traffic light system and can help you set appropriate credit policies for your customers.

We regularly publish lists of the latest insolvencies but by then it is too late. Our credit reports however predict approximately 96% of company insolvencies long before they arrive.

Companies in trouble usually have very bad cash flow and they try to deal with it by delaying payment to their suppliers, increasing your exposure to them.

If you supply on credit, help us help you identify the risks.

Why use a third party collector?

As a third party collector, we can also get your payments prioritised over those who are not as hot on collections. When your customer receives a letter from the Credit Protection Association regarding their outstanding account, they are going to want to get that resolved as a priority. Our overdue account recovery service can get your unpaid invoices to the top of their “to do” list and get your invoice paid.

Over the years we have collected billions in overdue invoices for our customers.

Our debt recovery and credit management services give our members the financial freedom needed to grow and prosper, while our new Late Payment Compensation department could unlock hidden potential and offer the compensation needed to springboard your business to success.

You might be hesitant about contacting a debt collection agency. What are they going to be like?

Can they help your particular type of business?

There is no need for concern. CPA are courteous, helpful and very probably have had direct experience of working with your type of business.

Debt collection agencies are not all alike.

Success lies in both recovering money and keeping customers happy. The Credit Protection Association was founded in 1914 and  has helped tens of thousands of UK businesses to collect outstanding payments and reduce the risk of incurring bad debt. We believe that creditors deserve to be paid for the work or goods they have supplied but we fully understand the need to maintain
the best possible relationship with customers!

At The Credit Protection Association, we provide solutions, advice and back-up in all areas relating to the supply of services or goods on account. Client-members receive everything they need from a single source to reduce debtor days and write-offs.

The Credit Protection Association has helped has assisted tens of thousands of UK businesses with their credit control requirements, since the First World War.

We are polite, firm and efficient when it comes to recovering outstanding debt.

“We have used CPA for a number of years now. The website is easy to navigate around with lots of helpful reports. The staff are always at hand and very friendly. CPA has  helped us reduce our debt over the years and keep track of potential issues with our customers.”
~ CPA client in Buckinghamshire

“The service from CPA has proved to be everything that you said it would be. We have already seen a huge benefit. We have had a number of overdue accounts paid promptly and directly to us. It is also a huge weight off our mind to know that once we have passed an overdue payment over to you, you take care of everything whilst keeping us informed.
~ Credit Controller client in Warrington

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


Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

CPA is passionate about late payment

The Credit Protection Association has been protecting smaller firms against poor payment practices for over 100 years.

We are extremely passionate about breaking the late payment culture that holds back the UK economy and threatens many SMEs with cash flow difficulties being the single biggest killer of Britain’s small businesses.

If you were regularly paid late we can help. Those former customers used you to boost their own cashflow, regularly paying you late.

As a result you had extra costs, you had the distraction of having to chase payment, you had opportunity costs because your capital was tied up in their late invoices.

Under little used legislation, you are entitled to compensation for those late payments.

Now you can boost your own cash-flow.

CPA can help unearth the those hidden treasures.

We have the technology to reveal the compensation you are due and we have the extensive experience and expertise to then turn those claims into cash.

Yes, CPA can help you boost your business cash-flow.

Don’t let your bankers control you, contact CPA today.

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

Read our blog here on how to crack down on the late payment culture.

Read our blog here on how to give late payers the slap they need.

The “Why” of the late payment culture.

New PM should walk the walk and back small firms over late payments

Paying late is “crack cocaine” to big business.

Late payment culture risks “spiraling out of control”

visit our late payment compensation page

See our full blog and FAQ on late payment compensation

Do you realise you could be sitting on a fortune?

Late payments often result in a cash flow crunch and leave SMEs in need of a cash injection.

If you sold B2B on credit then there may be a hidden source of capital you can call on.

If you fancy an bit of extra cash in your business, rather than jumping through hoops with your bank, you could look to uncover the resources from an unexpected source within your own business.

Not many are aware but there could be a hidden fortune within your business, sitting there, just waiting to be uncovered and released.

We can help you uncover the pile of gold, you didn’t even know you were sitting on.

If you trade with other businesses and were often paid late then you could be entitled to significant compensation.

Under little known and under-utilised legislation your business could be due huge amounts in compensation that you didn’t even know about.

Let’s be clear – this is not a way to weaken any customer relationships you value. It is one that identifies who’s been paying late and then recover the potentially significant sums in compensation using Late Payment Legislation from businesses where the relationship has already ended.

You can pick and choose who you want us to follow up – but once we’ve agreed which companies you’d like to pursue compensation from it’s a fast process and there’s no financial outlay to you whatsoever. My team at CPA put its expertise to work to recover the compensation due and fight late payment culture.

That compensation could provide the cash boost your business needed.

But don’t delay, that compensation evaporates if not claimed within six years of the late payment.

How can CPA help?

CPA has developed a unique technology to dig into your accounting records and discover the cash injection you are due by means of compensation. The software does all the hard work. Our software interacts over the cloud with over 300 different software packages, working directly with your accounts package, just so long as it’s stored on a computer.

We recognise that most companies do not have the resources to spend time on the identification and calculation of Late Payment Compensation. Our service can produce an Analyses within just a few days with (usually) less than 30 mins of co-operation from our clients. We work directly with over 300 accounting packages but can also work with bespoke accounts packages. Indeed, speed is essential as the oldest invoices may fall foul of the 6-year time limit.

Once the Sales Ledger Analyses is made available to clients, all that is required is that management decide which commercially sensitive ex-customers to remove from the list and return it to us.

CPA then uses its years of collection experience to explain and recover the Late Payment Compensation Claims. Clients do not handle any part of the recovery process as our team will take all communications from the companies against who the claims has been made. Often, it’s simply a case of explaining the legislation, sometimes we have to go all the way and enforce the legislation through the courts.

The result is that we are realising clients’ claims worth tens and sometimes hundreds of thousands of pounds which, of course, is pure net profit.  You may also be among the recipients of “hundreds of thousands of pounds” should you elect to take advantage of our services.

We do the work, you receive the cash.

If you have supplied goods and services to businesses on credit and were regularly paid late then you could be due significant sums in late payment compensation.

We are talking to companies and unearthing claims in the hundreds of thousands from former business customers who paid them late. Large business customers who abused their power to inflict unfair and sometimes illegal payment practices.

We are helping business owners  who are looking to boost the returns from their business before they retire. We are helping businesses who have lost major clients after years of loyal service to get properly compensated for systematic late payment. We are helping companies that were looking to close down, who looked insolvent and finding that cash injection they need to avoid insolvency.

Those former clients who regularly paid you late can finally be made to pay.

Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!

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

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Read our Cash Flow Advice

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see our blog – 15 steps to avoid invoice fraud

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