UK Business News Today: 26 May 2026 | Economy, Markets & Insolvencies

UK businesses are facing pressure from several directions, with official figures showing 2,085 company insolvencies in April, the highest monthly total since June 2024. Rising labour costs, business rates, weaker consumer spending, falling bank lending and global conflict risks are all feeding into a more difficult trading environment. At the same time, households are facing a heavier tax burden, public borrowing has exceeded forecasts, and long-term unemployment has reached its highest level in a decade.

James Salmon, Operations Director.

SME-focused stories

Insolvencies surge, with 2,085 firms collapsing in April

Official figures show that 2,085 UK companies collapsed in April, the highest monthly total since June 2024 and 3% higher than April 2025. The figures mean almost 8,000 insolvencies have been recorded so far this year. David Hudson of FRP warned that the rise may be a sign of more distress to come, while R3’s Sonia Jordan said firms are being hit by higher labour costs, business rates, fuel and energy costs.

Why it matters: Rising insolvencies increase the risk of unpaid invoices and make credit checks, monitoring and fast debt recovery more important for SMEs.

Bank lending to UK business at lowest for nearly 30 years

Bank lending to UK non-financial businesses has fallen to its lowest level for nearly 30 years, dropping to 59% of GDP in Q3 2025. SME loans have also fallen sharply, from 12% of GDP in 2011 to 6.5% in 2026. This suggests many smaller firms are operating with tighter access to finance just as costs and payment risks are rising.

Why it matters: When finance is harder to obtain, late payment and bad debt can become even more damaging to SME cashflow.

Small firms flag growth concerns

Scottish small businesses are facing significant growth challenges, according to Novuna Business Finance. Its survey found that 83% of firms see external factors as barriers to growth, with 50% citing macro-economic uncertainty. Around 40% are worried about overseas conflict pushing up prices, above the UK average of 32%.

Why it matters: Cost uncertainty can squeeze margins and make customers more cautious about paying on time.

Businesses brace for conflict impact

The British Chambers of Commerce says the conflict in the Middle East is already affecting, or expected to affect, 80% of more than 800 surveyed UK firms. Businesses are concerned about higher energy prices and supply chain disruption. KPMG forecasts that UK GDP growth could slow to 0.8% in 2026 as these pressures weigh on the economy.

Why it matters: Supply disruption and higher input costs can quickly weaken customer payment behaviour and increase trading risk.

Supply chains unprepared for major shocks

The National Preparedness Commission has warned that Britain’s supply chains are not well prepared for major shocks such as wars. The report says the UK lags behind some European nations in stockpiling critical supplies and remains exposed to disruption in access to essential materials. The Government says supply chains are strong and resilient, adding that it actively monitors risks.

Why it matters: SMEs relying on imported goods or key materials may face delays, higher costs and greater risk of customer disputes.

Businesses warn over redundancy changes

The Government has been warned that changes to redundancy consultation rules under the Employment Rights Act could impose significant costs on businesses. Firms making 250 or more redundancies may need to consult across the whole organisation. Matthew Percival of the CBI said the changes risk adding cost and complexity at an already difficult time.

New laws may prompt more creative interview techniques

Chris Deeley of JMW has warned that the upcoming Employment Rights Act, effective from 1 July 2026, may encourage businesses to adopt more unconventional hiring methods. With unfair dismissal rights applying to new starters, employers may want to make recruitment more robust. However, he warned that creative vetting techniques could create discrimination risks and perceptions of unfairness.

Ryanair says it is effectively debt free

Ryanair says it is now “effectively debt free” after repaying its final €1.2bn bond. The airline says this is the first time since its 1997 flotation that it has cleared all its debt, leaving it with an unencumbered fleet of 620 Boeing 737 aircraft. CFO Neil Sorahan said this strengthens Ryanair’s cost advantage over rivals with expensive debt and aircraft leases.

Sumer pauses £1bn sale amid interest

Sumer has paused its proposed £1bn sale despite strong investor interest. Owner Penta Capital Partners is exploring alternatives, including a continuation vehicle allowing investors to cash out or reinvest. Founded in 2022 by former KPMG chief operating officer Warren Mead, Sumer generates around £300m in annual revenue, employs about 3,000 staff and is the UK’s 12th largest accounting practice.

Economy, tax and public finances

UK borrowing soars to £24.3bn

UK public sector borrowing reached £24.3bn in April, exceeding forecasts by £3.4bn. The Office for National Statistics said debt interest repayments hit a record £10.3bn for April, while higher benefits spending also contributed to the increase. The Treasury said it is cutting borrowing and debt while supporting growth through £120bn of capital investment over the Parliament.

Tax burden on households skyrockets

HMRC collected £87.3bn in taxes in April, £6.3bn more than last year. Workers contributed £52.5bn in income tax and National Insurance, with frozen thresholds pushing more people into higher tax brackets. Sarah Coles of AJ Bell warned that these figures are likely to rise further.

Property taxes in Britain hit record high

Britain’s property tax burden has reached a record 3.7% of GDP, according to analysis by tax firm Ryan. The proposed “mansion tax” would add costs for homes valued above £2m, potentially affecting ordinary properties in London. Experts warn that if the threshold is frozen or lowered, more homes could be pulled into the tax net.

Stamp duty receipts drop after tax changes

Stamp duty receipts fell to £4.3bn in the first four months of the year, around 6% lower than in 2025. Rachel Reeves’s reduction of thresholds increased costs for many buyers, with the main threshold falling from £250,000 to £125,000 and first-time buyer relief dropping from £425,000 to £300,000. Experts say the changes have slowed housing transactions, especially in London and the South East.

Burnham pledges to bring in land value tax

Andy Burnham has said he would introduce a land value tax if elected as Britain’s next prime minister. The Mayor of Greater Manchester argues that the UK tax system favours wealth tied to land and property, saying land is undertaxed. He has also called for reform of council tax and business rates, while promising not to raise income tax, VAT or National Insurance.

Entrepreneur exodus warning over wealth taxes

Ruth Sunderland in the Mail has warned that proposals from Labour leadership hopeful Wes Streeting to equalise capital gains tax with income tax could hit private investors and small business owners. Streeting says the plan could raise £12bn, but critics argue it could harm the UK’s business environment. Sunderland warned that it may damage the UK’s reputation as a place to start a business and could drive entrepreneurs overseas.

HMRC says most estates will still not pay IHT after pension change

From 6 April 2027, defined contribution pensions will be included in inheritance tax calculations at the standard 40% rate. HMRC says the change will affect around 10,500 estates, with a further 38,500 facing increased IHT liabilities. Executors will need valuations from pension providers, and beneficiaries may also pay income tax on remaining funds after IHT has been applied. HMRC says more than 90% of estates will still pay no IHT.

Sole traders issued Making Tax Digital reminder

HMRC has reminded around 860,000 sole traders and landlords about Making Tax Digital for Income Tax. Those with qualifying income above £50,000 will need to adopt digital tax reporting, keep digital records and submit updates through compatible software. The rules are intended to modernise tax reporting but will require preparation from affected taxpayers.

HMRC issues late-filing fine warning

HMRC has warned households who missed the 31 January self-assessment deadline for 2024/25 tax returns to act quickly. Late filers already face an automatic £100 penalty, with daily penalties of £10 capped at £900. After six months, a further penalty of 5% of the tax due or £300, whichever is greater, may apply.

Employment and labour market

Redundancy warnings hit record levels

The UK saw its highest number of redundancy warnings since 2020 last year, with 315,605 jobs flagged and payouts exceeding £477m. Data from the Liquidation Centre shows more than 2m redundancy warnings were issued between 2020 and 2025, a 45% increase since 2021. Early 2026 has seen further pressure, with 736 employers filing redundancy notices affecting 56,396 jobs.

Why it matters: Redundancies weaken household confidence and can reduce demand for SMEs, while also signalling stress among business customers.

Long-term unemployment hits decade high

Long-term unemployment has reached its highest level in a decade, with 474,000 people out of work for more than 12 months, according to the ONS. Youth unemployment has climbed to 16.2%. An additional 129,000 people have been classed as long-term unemployed since Labour came to power in July 2024.

Milburn warns of youth unemployment crisis

Alan Milburn, the Government’s jobs tsar, has warned of a looming youth unemployment “economic catastrophe”. There are currently 729,000 people aged 16 to 24 unemployed and 957,000 not in education, employment or training. Milburn said the welfare state was built for a different era and raised concerns about a “bedroom generation” whose communication and concentration skills may affect their

Grants could boost apprenticeships

Ministers are considering grants and bursaries for families on benefits to encourage teenagers to pursue apprenticeships. Alan Milburn has warned that the current benefits system can discourage young people from entering the workforce. The proposed support would aim to bridge financial gaps for lower-income households.

Job hugging increases

Deutsche Bank analysis suggests “job hugging” is increasing, with UK workers more reluctant to resign as job vacancies fall. ONS figures show vacancies have dropped to 705,000 in the latest three-month period, down from a 2022 peak of 1.3m. Jack Kennedy of Indeed said the jobs market remains tough and offers fewer opportunities.

Sage CEO: AI should elevate human work, not replace it

Steve Hare, chief executive of Sage, says AI should be used to elevate human work rather than replace people completely. He said machines can do some things better, but humans still provide judgement and context. His comments contrast with Standard Chartered CEO Bill Winters’ remarks that AI would replace “lower-value human capital” as the bank announced plans to cut 8,000 jobs.

Retail, consumers and property

Retail sales dive as spending confidence wanes

UK retail sales fell by 1.3% in April, the sharpest monthly decline since May last year, according to the ONS. The fall reversed a 0.6% increase in March. The British Retail Consortium blamed weaker spending confidence and uncertainty around summer holidays, while Justin Parr of Treyd said retailers are dealing with consumers whose spending power is under huge pressure.

Retail openings boost optimism

High streets in England and Wales have seen 723 new retail stores open over the past year, according to Valuation Office Agency data analysed by Ryan. This represents an increase of more than 13 stores per week. However, more than 6,000 retail premises have closed over the last five years, with London seeing the largest decline after losing 1,266 stores.

Labour’s new holiday tax will cost jobs

Families visiting popular tourist destinations could face an overnight visitor levy of up to £300, according to the Telegraph. As many as 10 of England’s 14 regional mayors are reportedly planning or considering the tax. An Oxford Economics paper for Hospitality UK estimated the levy could cost 33,000 jobs, reduce tourism spending and cut GDP by £2.2bn. The Government says the final design has not been decided and it will be up to mayors whether to use it.

Property Sector calls for homebuying overhaul

Zoopla has warned that political uncertainty should not derail reforms to Britain’s homebuying system. The average time between offer and exchange has stretched to 134 days, around 50% longer than in 2019, contributing to one in four sales collapsing. Sector insiders are urging ministers to simplify the process as mortgage costs add further pressure.

Leaseholders face losses and delays

Data from Hamptons and Connells Group shows that 35% of leasehold properties take more than six months to exchange contracts, compared with 13% of freehold homes. Leasehold properties typically sell for 93% of asking price, while freeholds achieve 95.1%. The proposed Commonhold and Leasehold Reform Bill aims to address some of the problems faced by leaseholders.

Tracker mortgage demand surges

Tracker mortgages are becoming more popular, according to Stonebridge Mortgage and Protection Network. The proportion of borrowers choosing trackers rose to 12% in April, compared with 4.1% a year earlier. Fixed-rate deals fell from 95.4% to 87.6%, with the lowest two-year tracker rates below 4% while fixed rates start at 4.55%.

Investment, finance and global business

Investors flock to gold amid uncertainty

Investors are increasingly turning to gold as UK political uncertainty, inflation concerns and banking stability worries persist. The Pure Gold Company reports a 133% rise in demand from finance professionals, with first-time buyers now accounting for 53% of gold ownership. Physical gold investments within pensions and SIPPs have risen by 318%.

Younger investors flock to trusts

Invesco research shows younger investors are becoming more interested in investment trusts. Some 55% of investors aged 25 to 34 say they are likely to invest in a trust within six months, compared with 29% of all investors. Among 18 to 24-year-olds, 38% said they would use an investment trust, compared with 9% of over-65s. The research also highlights the role of financial influencers.

UK sees £325bn of dirty money a year

The Finance Innovation Lab estimates that £325bn of illicit money flows through the UK each year, equivalent to more than 10% of GDP. The figure includes funds linked to corruption, money laundering and tax evasion. The APPG on Anti-Corruption and Responsible Tax is backing calls for more Government action, including greater funding for the National Crime Agency and Serious Fraud Office.

Huawei says advanced chips are five years away

Huawei says it is around five years away from producing 1.4-nanometre chips capable of competing with TSMC. US sanctions continue to limit Chinese access to cutting-edge foreign technology, including ASML lithography machines. China is therefore prioritising self-sufficiency in advanced semiconductors.

Construction and housing

Construction sector under pressure

The UK construction sector remains under pressure, with RSM data showing 3,827 insolvencies across the industry over the past year. Housebuilding remains below Government ambitions, with 208,600 net additional dwellings recorded in 2024/25. Higher interest rates and material costs continue to affect firms, even though construction contributed to a 0.6% increase in GDP in Q1.

Why it matters: Construction insolvencies can create knock-on losses for subcontractors, suppliers and SMEs extending trade credit.

Market snapshot

Global markets opened the week in a risk-on mood as hopes of a US-Iran deal to reopen the Strait of Hormuz lifted equities and pushed oil prices lower. However, fresh US military strikes in Iran overnight complicated the picture, adding uncertainty and reversing some of the earlier optimism in commodity markets. US cash markets are closed for Memorial Day, which may reduce liquidity and increase volatility.

US equities closed at fresh record highs on Friday 23 May. The Dow Jones Industrial Average finished at 50,579.70, the S&P 500 at 7,473.47 and the Nasdaq Composite at 26,343.97. European markets also ended higher, with the FTSE 100 at 10,466.26, Germany’s DAX at 24,888.56, France’s CAC 40 at 8,115.75 and the Euro Stoxx 50 at 6,019.45. Asian markets were also firmer during Monday’s session, with the Nikkei 225 at 64,996.09, the Hang Seng at 25,599.45, the Shanghai Composite at 4,145.37 and Australia’s ASX 200 at 8,657.84.

Oil remains the key market pressure point. Brent crude fell sharply at the Monday open on hopes of progress over the Strait of Hormuz, before rebounding after fresh US military action. The market summary put Brent at $99.29 a barrel on Monday morning and WTI at $92.77. Lower oil would ease cost pressure on transport, manufacturing, food and fuel, but the benefit remains uncertain while military risks continue.

Gold stayed elevated at around $4,524.20 an ounce, supported by Middle East uncertainty and central bank demand. The report notes that gold initially slipped as optimism over peace talks improved, before the overnight strikes restored some defensive demand. Base metals were softer, with copper prices declining and LME copper inventories falling by 2,375 tons.

Currency markets reflected the same uncertainty. The dollar weakened over the weekend as hopes for a US-Iran deal improved risk appetite, while the euro strengthened slightly against sterling. The summary placed USD/GBP at 0.7421, EUR/GBP at 0.86368 and JPY/GBP at 0.4661. The pound also came under pressure against the euro after weak UK services data.

Insolvency notices

Appointment of Administrators

• NOVA PERSONNEL LTD
• SKCG ELECTRICAL LTD
• TOTAL CARBIDE LTD

Appointment of Liquidators

• 9ROOFTOPS MARKETING LTD
• APSIS LIMITED
• BERT HARDY LIMITED
• BLUE MOTOR FINANCE DD LIMITED
• DAN KLORES COMMUNICATIONS LIMITED
• DKV GEOTECHNICAL PLANT LIMITED
• EDWARDS & CO SURVEYORS LIMITED
• ENGAGE SMARTER LTD
• EURO-COMPOSITES UK LIMITED
• FIRSTSTOP RAIL SOLUTIONS LIMITED
• GLOBALDRIVE AUTO RECEIVABLES UK 2023-A PLC
• GROUP RISK SERVICES LIMITED
• LUNA BLUE LTD
• OCTAVIA CHELSEA LIMITED
• PENNINE HIP AND KNEE SURGERY LIMITED
• PROFESSIONAL ASSURED SEC LIMITED
• THE EDGE GROUP PARTNERSHIP LTD
• WEBSENSE SC OPERATIONS LIMITED

Petitions to Wind Up

• CLEAR SUMMER MAY LIMITED
• GREEN LANE DENTAL LIMITED
• IWT HOLDINGS LIMITED
• JCH PLANT HIRE LTD.
• SAIF INTERNATIONAL LTD
• SPARTAK RACING LIMITED
• THE WINDOW CLEANING GROUP SOUTH EAST LIMITED
• TOFOS LANCASTER LTD
• ZMLUK LIMITED

What CPA can do for you

When insolvencies are rising and customers are under pressure, the danger is not always obvious until it is too late. A customer may seem fine one month, then delay payment, request longer terms or suddenly appear in an insolvency notice.

CPA membership helps you put early-warning checks around the businesses you trade with. CreditCare reports, monitoring services and overdue account recovery support can help you make better credit decisions, spot risk earlier and act quickly when payment behaviour changes.

In a tougher economy, knowing who you are dealing with is not a luxury. It is part of protecting your cashflow.

Just call 020 8846 0000 (Monday to Friday, 9am to 5pm) or email PaidQuick@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, Economical collections.

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