While it was good to see the end of February and the official start of Spring, it’s not just the odd frosty morning that will bring a chill to directors and business owners when they look through this breakdown of the latest Scottish corporate insolvency figures.

In Scotland last month there were 103 company insolvencies, a 10% increase on the total from a year ago and 28 more than a month previously. 

February’s total was made up of 38 compulsory liquidations (up from 32); 60 CVLs (up from 37) and five administrations (down from six). There were no CVAs or receiverships appointments recorded. 

Scotland’s insolvency regime is partly devolved. The Accountant in Bankruptcy (AiB), Scotland’s insolvency service, administers the Register of Insolvencies which is a publicly accessible statutory register regarding the insolvency of individuals and businesses in Scotland including company liquidations and receiverships.  

Between June 26th 2020 and February 28th 2025, there were three restructuring plans and one moratorium in Scotland. Both of these procedures were created by the Corporate Insolvency and Governance Act 2020.

Traditionally Scotland has seen more compulsory liquidations than any other kind of insolvency process but CVLs overtook them in April 2020 and have remained higher ever since.

This shows that more Scottish directors and their accountants are taking difficult decisions early but this enables them to retain control of key elements of the process rather than relying on creditors taking action and forcing the closure of their businesses.

The 12 month rolling insolvency rate for the effective register shows a rate of 51.6 companies per 10,000 companies on the effective register. This was down by 1.2 from the preceding 12 months ending February 2024.

All areas of the UK saw an increase in corporate insolvencies in February – the second consecutive monthly rise. 

The total number of company insolvencies for the whole of the UK in February 2025 was 2,159 – a monthly increase of 85.

Chris Horner, insolvency director with Business Rescue Expert, said: “The main rise in Scottish corporate insolvencies over the past month came from a large increase in CVLs – almost double from the previous month.

“This shows that Scottish directors are being proactive in their decisions to seize control of the liquidation process and manage the timescale as much as they are able. 

“Compulsory liquidations also rose in Scotland as HMRC are continuing in their efforts to crack down on companies with corporation tax, VAT, PAYE and National Insurance (NICs) arrears, with more resources being allocated to them and more staff being recruited to investigate and take action. 

“This will see the continued use of statutory demands and winding up petitions which will continue to keep the number of compulsory liquidations high – overall UK numbers last month were at their highest level for over a decade.

““With firms facing further increases in expenses when National Insurance and National Minimum Wage rises are introduced in April, we expect enquiries for restructuring and insolvency support to increase as directors look to hear specialist advice about their business finances and we expect this to continue for the next few months as the impact of the rise in outgoings becomes apparent. 

“This is a particular issue for small businesses as they can find it difficult to pass on extra costs to customers while remaining competitive and many businesses of this size will inevitably be considering making savings through, for example, reduced investment or reductions in staff levels. 

With a tough UK government Spring Statement coming next week, now is the perfect time to find out what options you have to protect your business from the storms ahead. 

You can get in touch with us right now to arrange a free initial consultation to discuss what options you have available depending on your unique circumstances that you can begin to implement straight away. 

No matter what your aims and objectives are for 2025, the sooner you get some impartial, practical advice and ideas, the sooner you can act on them to protect and strengthen your business.