MORE company directors are voluntarily shutting down their businesses, according to insolvency professionals in Dorset.

R3 Southern & Thames Valley said newly published statistics for 2021 showed that corporate insolvencies in England and Wales were up by more than 10 per cent on 2020 but remained below pre-pandemic levels.

They were driven by a rise in Creditor’s Voluntary Liquidations (CVLs), which reached their highest since 2009.

Garry Lee, chair of R3’s Southern and Thames Valley region, including Dorset, said: “The increase this year – and the surge in CVLs in the final quarter of 2021 – suggests that many directors are opting to close their businesses as they lack confidence in their trading prospects in the current climate.

“Furthermore, these businesses may also be facing pressure from creditors who were previously unable to take enforcement action but are now able to do so after the lifting of some restrictions.

“And while insolvencies still haven’t reached pre-pandemic levels, this is unlikely to remain the case for long.”

Garry, who is an associate director in the recovery and restructuring services department at accountancy firm Smith & Williamson’s Southampton office, added: “Given the current climate, we urge company directors in Dorset to be aware of the signs of financial distress if any present themselves.

“Our message is a simple one: if you’re having problems paying staff or suppliers, your stock levels are piling up, or you’re worried about paying your rent or your tax debts, or your business’ finances or future, seek help from a qualified and regulated advisor as soon as possible.”