Hospitality business insolvency and rescue
Hospitality businesses (pubs, restaurants, cafes and hotels) operate on thin margins and high fixed costs, so a quiet quarter or an energy spike can quickly create arrears. Many also carry pandemic-era debt, including Bounce Back Loans. The right route depends on whether the underlying site and trade are viable, and early advice matters because rent quarter days and energy contracts create hard deadlines.
The cost squeeze
Rent and energy bills are large and largely unavoidable, staff costs have risen, and trade is seasonal and weather-dependent. VAT and PAYE are often the first arrears to appear when takings dip. See VAT arrears and HMRC debt.
Leases and the CVA option
A CVA can be especially useful in hospitality, because it can compromise historic debt and, in some cases, onerous leases while the business keeps trading. Where a site is viable but the company is not, administration may enable a sale. Where a site is no longer viable, an orderly liquidation is the cleaner close.
Pub closures
The BBPA reported 161 pubs closing for good across England, Scotland and Wales in the first quarter of 2026, 26% more than the same period in 2025 (published 5 May 2026). Our UK pub closures tracker collates the latest published figures, each dated and labelled with its scope.
The insolvency figures
In the 12 months to July 2026 there were 3,221 company insolvencies in accommodation and food service in England and Wales, 14% of cases where the industry was recorded and the third highest of any industry (Insolvency Service, published 18 August 2026). The count partly reflects how many companies in the sector are on the register, so it is not the chance of any one company failing. See the UK company insolvency tracker for the full industry table.
Common questions
Can a CVA help my restaurant or pub?
Often yes. A CVA can compromise historic debts and let a viable hospitality business keep trading while it repays an affordable amount over time. A practitioner will assess whether the site and trade are viable.
How many pubs are closing in the UK?
The British Beer and Pub Association reported 161 pubs closed for good across England, Scotland and Wales in the first three months of 2026, almost two a day, against 128 in the same period of 2025. See our pub closures tracker for the latest dated figures.
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