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CONTRACTOR TAXACCOUNTANTS · IR35 SPECIALISTS

UK Contractor Insolvency Index

UK contractor-sector company insolvencies rose 60.5% between 2016 and 2025

A sourced, monthly read on company insolvencies across the two SIC sections contractors sit in, drawn from Insolvency Service public records, with a narrower figure isolating the specific IT, consultancy and engineering divisions this site tracks. Updated Jun 2026.

3,547
Section J+M company insolvencies in the trailing 12 months
59.0%
of those insolvencies sit in the captured contractor divisions (62/70/71)
60.5%
more insolvencies in 2025 than in 2016
374
insolvencies in Nov 2024, the highest month on record
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Key findings

  • Combined Section J and M insolvencies rose 60.5% from 2,304 in 2016 to 3,698 in 2025.
  • In the trailing 12 months to Jun 2026, 3,547 companies entered insolvency across Section J (1,481) and Section M (2,066) combined.
  • Of that total, 2,092 (59.0%) sat in the specific divisions this site tracks, computer programming and IT consultancy (division 62), management consultancy (division 70) and architectural and engineering activities (division 71). The captured share rose 74.4% between 2016 and 2025.
  • Creditors Voluntary Liquidation (CVL) is the dominant procedure across both sections, as it is economy-wide: directors choose voluntary wind-up far more often than creditors force a compulsory liquidation through the courts.
  • In Jun 2026, 237 contractor-sector companies entered insolvency, of which 190 were CVLs, 23 compulsory liquidations, and 14 administrations.

Source: Insolvency Service, Company Insolvency Statistics (record-level data), under the Open Government Licence v3.0. England, Wales and Scotland. Figures may be cited with attribution to Contractor Tax Accountants.

Contractor-sector insolvencies by year

Each bar shows the combined total for Section J and Section M registered in that calendar year (complete years only). The rise from 2022 broadly follows the same pattern seen across UK company insolvencies economy-wide, as the pandemic-era moratorium on winding-up petitions unwound.

Annual contractor-sector company insolvencies by year
YearSection J+M insolvencies
20162,304
20172,208
20182,331
20192,444
20201,848
20212,468
20223,289
20233,587
20243,600
20253,698

The monthly trend by procedure

The stacked area chart shows monthly insolvency registrations across Section J and M combined, broken down by the three main procedures: CVL, compulsory liquidation, and administration.

Monthly contractor-sector insolvencies by procedure
MonthCreditors' voluntary liquidationCompulsoryAdministrationTotal
Jan 2016965414164
Feb 20161045423181
Mar 20161274517189
Apr 20161424230214
May 20161102622158
Jun 20161383724199
Jul 20161203727184
Aug 20161262126173
Sep 20161354332210
Oct 2016926033185
Nov 20161336325221
Dec 20161253915179
Jan 20171416714222
Feb 20171144625185
Mar 20171383822198
Apr 20171453416195
May 20171044216162
Jun 20171033127161
Jul 20171083618162
Aug 20171053021156
Sep 20171274932208
Oct 20171004015155
Nov 20171383614188
Dec 20171222821171
Jan 20181584019217
Feb 20181174021178
Mar 20181183720175
Apr 20181153422171
May 20181243820182
Jun 20181384720205
Jul 20181113923173
Aug 20181354620201
Sep 20181343820192
Oct 20181367221229
Nov 20181424230214
Dec 2018753735147
Jan 20191566821245
Feb 20191065424184
Mar 20191333526194
Apr 20191444728219
May 20191384024202
Jun 20191145123188
Jul 20191443118193
Aug 20191522823203
Sep 20191383929206
Oct 20191323935206
Nov 20191404230212
Dec 20191032216141
Jan 20201254425194
Feb 2020993530164
Mar 20201173021168
Apr 20201291115155
May 2020127522154
Jun 2020791219110
Jul 2020782528131
Aug 2020861320119
Sep 2020120425149
Oct 2020128916153
Nov 2020103917129
Dec 2020158730195
Jan 202192718117
Feb 2021108510123
Mar 20211491419182
Apr 202115669171
May 2021165710182
Jun 2021207611224
Jul 202117245181
Aug 2021228212242
Sep 2021254216272
Oct 2021209616231
Nov 2021256723286
Dec 20212181316247
Jan 20222291411254
Feb 2022198514217
Mar 20223142111346
Apr 20222641919302
May 2022254239286
Jun 20222162218256
Jul 2022251187276
Aug 20222602614300
Sep 2022185327224
Oct 20222093518262
Nov 20222164918283
Dec 20222233217272
Jan 20231933710240
Feb 20231921717226
Mar 20232525823333
Apr 20231993023252
May 20232982617341
Jun 20232144929292
Jul 20232103712259
Aug 20232794425348
Sep 20232214916286
Oct 20232604619325
Nov 20232697528372
Dec 20232253119275
Jan 20241885722267
Feb 20242393922300
Mar 20242164422282
Apr 20242705432356
May 20242222916267
Jun 20242584429331
Jul 20242455035330
Aug 20242034524272
Sep 20241914323257
Oct 20242073724268
Nov 20242706438372
Dec 20242014319263
Jan 20252095427290
Feb 20251775817252
Mar 20252544425323
Apr 20252206824312
May 20252575823338
Jun 20252174424285
Jul 20252567325354
Aug 20252423728307
Sep 20252224527294
Oct 20252487025343
Nov 20252254032297
Dec 20252153820273
Jan 20261764819243
Feb 20262103424268
Mar 20262504333326
Apr 20262096019288
May 20262274621294
Jun 20261902319232

Breakdown by procedure

The table shows the number of Section J+M insolvencies by procedure type in 2025.

Procedure2025 count% of total
Creditors Voluntary Liquidation (CVL)2,74274.1%
Compulsory Liquidation62917.0%
Administration2366.4%
Company Voluntary Arrangement (CVA)280.8%
Administrative Receivership00.0%
Total3,698100%

How much of Section J and M is actually contracting?

Sections J and M are coarse: Section J also covers publishing, broadcasting and telecoms, and Section M also covers legal and accounting, advertising, R&D and veterinary activities, none of which are contractor-heavy. The chart splits each year's Section J+M total into the captured contractor divisions (62 IT consultancy, 70 management consultancy, 71 engineering, dark bars) and everything else in the same two sections (light bars).

Divisions 62/70/71 as a share of Section J+M insolvencies, by year
YearDivisions 62/70/71Elsewhere in Section J+MSection J+M total
20161,2471,0572,304
20171,2489602,208
20181,3191,0122,331
20191,3891,0552,444
20201,0917571,848
20211,5449242,468
20221,9601,3293,289
20232,1251,4623,587
20242,1381,4623,600
20252,1751,5233,698

In the trailing 12 months to Jun 2026, the captured divisions accounted for 59.0% of the combined Section J+M total, 2,092 of 3,547 insolvencies.

Methodology and sources

Data source. Counts are drawn from the Insolvency Service record-level data file, published monthly as part of the Company Insolvency Statistics release on gov.uk. Each record represents a single insolvency event registered with Companies House or the Insolvency Service, tagged with the company's SIC code and procedure type. We filter to SIC 1-digit Sections J (Information and communication) and M (Professional, scientific and technical activities), the two sections that between them cover most contractor-sector activity.

What is counted. Each figure is the number of insolvency events registered in that period, not the number of unique companies. A company that enters administration and subsequently converts to CVL appears twice: once for each procedure. This is consistent with how the Insolvency Service reports its own headline figures.

Captured divisions. The same record-level file tags every insolvency with a 2-digit SIC division as well as the procedure type, so the "captured" figures above (divisions 62, 70 and 71) use no additional source: they are the same Insolvency Service data, split one level deeper, and sit entirely within the Section J+M totals shown elsewhere on this page.

Caveats. Section-level figures are coarse: SIC Sections J and M each cover several industries beyond contracting, so a rise or fall in the section total does not necessarily track the contractor-specific captured figure exactly. Counts are not rates: an increase in insolvency numbers may partly reflect growth in the total number of active companies rather than a worsening of sector conditions. The pandemic years (2020 to 2021) are not comparable to other years because temporary legislation suppressed compulsory liquidations. CVA and receivership counts are low and should be read as indicative only.

Updated. Data through Jun 2026 (latest Insolvency Service release). Generated Jul 2026.

Download the insolvency data (CSV)

Free to cite and republish with attribution to Contractor Tax Accountants. This page is a data summary and does not constitute insolvency or tax advice on any individual situation.

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Frequently asked questions

What does the UK Contractor Insolvency Index measure?

It counts company insolvencies registered each month under two SIC Section headings that between them cover most contractor activity: Section J (Information and communication, which captures IT contracting) and Section M (Professional, scientific and technical activities, which captures management consultancy and engineering). Counts are drawn from Insolvency Service record-level data covering England, Wales and Scotland, and track five main procedures: Creditors Voluntary Liquidation (CVL), compulsory liquidation, administration, Company Voluntary Arrangement (CVA), and administrative receivership.

Why use Sections J and M rather than exact SIC codes?

The Insolvency Service's monthly record-level data identifies each insolvency by 1-digit SIC section and, separately, by 2-digit SIC division, but not down to the specific 5-digit codes this site's UK Contractor Index tracks. Sections J and M are the closest coarse match: J also includes publishing, broadcasting and telecoms firms that are not contracting businesses, and M also includes legal and accounting firms, advertising agencies and R&D labs. To narrow this, the 'captured' figures on this page isolate the 2-digit SIC divisions that overlap the Contractor Index SIC set (division 62 IT consultancy, 70 management consultancy, 71 engineering), and report what share of the wider Section J+M total those divisions actually account for.

What share of Section J and M insolvencies are actually contractor divisions?

In the trailing 12 months to Jun 2026, divisions 62, 70 and 71 accounted for 59.0% of all Section J and M insolvencies combined (2,092 of 3,547). The remainder sits in adjacent but distinct industries within the same two sections, publishing, telecoms, legal and accounting, advertising and R&D among them.

What is a Creditors Voluntary Liquidation (CVL)?

A CVL is the most common insolvency procedure for UK companies generally, contractor-sector businesses included. The company's directors resolve to wind up the business voluntarily when they conclude it cannot pay its debts, and a licensed insolvency practitioner is appointed as liquidator to realise assets and distribute proceeds to creditors. CVLs typically account for the large majority of insolvency events in this dataset, reflecting how much more often directors choose to wind up voluntarily than have a compulsory liquidation forced on them by the courts.

Where does this data come from?

All insolvency counts come from the Insolvency Service's record-level data file, published as part of the Company Insolvency Statistics statistical release on gov.uk. The Insolvency Service is the UK government agency that handles corporate and personal insolvency. Its data is published under the Open Government Licence v3.0 and covers England, Wales and Scotland. The figures are updated monthly.