Construction company insolvency and rescue

Construction consistently accounts for more company insolvencies than any other sector in the UK, and the reasons are structural rather than a matter of bad management. Fixed-price contracts agreed months in advance collide with rising material and labour costs; retentions tie up cash for years; payment runs long down the supply chain, so a main contractor failure cascades to subcontractors; and the Construction Industry Scheme adds tax complexity. The result is that even a busy, profitable-on-paper construction company can run out of cash. If your construction firm is under pressure, the same options apply as elsewhere, a Time to Pay arrangement with HMRC, a CVA to repay historic debt while you finish contracts, administration to protect a viable business, or an orderly liquidation, but the timing of contracts and retentions makes early advice especially valuable. A Licensed Insolvency Practitioner who understands construction can help you protect ongoing jobs and your own position.

Why construction firms run out of cash

Fixed-price contracts versus rising input costs, retentions held for years, long payment chains, and upstream failures hitting subcontractors. Profit on paper does not mean cash in the bank, which is why cash flow problems are the sector's biggest killer.

Protecting ongoing contracts

Where the business is viable, administration or a CVA can protect live contracts and goodwill while historic debt is dealt with. Acting before a winding-up petition keeps those options open.

Common questions

Why do so many construction companies go bust?

Structural cash-flow pressures: fixed-price contracts against rising costs, retentions tying up cash, long payment chains, and the knock-on effect when a main contractor fails. These hit even profitable firms.

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Construction company insolvency and rescue. Construction consistently accounts for more company insolvencies than any other sector in the UK, and the reasons are structural rather than a matter of bad management. Fixed-price contracts agreed months in advance collide with rising material and labour costs; retentions tie up cash for years; payment runs long down the supply chain, so a main contractor failure cascades to subcontractors; and the Construction Industry Scheme adds tax complexity. The result is that even a busy, profitable-on-paper construction company can run out of cash. If your construction firm is under pressure, the same options apply as elsewhere, a Time to Pay arrangement with HMRC, a CVA to repay historic debt while you finish contracts, administration to protect a viable business, or an orderly liquidation, but the timing of contracts and retentions makes early advice especially valuable. A Licensed Insolvency Practitioner who understands construction can help you protect ongoing jobs and your own position.

Help for a construction business in difficulty

Tell us briefly what is happening and we will arrange a free, confidential, no obligation call with a Licensed Insolvency Practitioner. The earlier you get advice, the more options you usually have.

Free, confidential and no obligation. We are an independent information service and introduce directors to a Licensed Insolvency Practitioner. This is general information, not regulated advice.