Ireland insolvencies fall 7% as creditor enforcement rises

Deloitte Ireland reported 812 corporate insolvency appointments in Ireland in 2025, down 7% from 2024.

Its analysis points to a marked shift within that total, with company-led closures falling and creditor-led enforcement rising. Court-appointed liquidations rose 58% to 104 cases from 66 a year earlier, while receiverships increased 30% to 130 from 100.

Creditors' voluntary liquidations still accounted for most insolvencies, at 535 cases or 66% of the annual total. But that category fell 20% from 668 in 2024, helping to offset the rise in court actions and receivership appointments.

The Revenue Commissioners were a major factor in the increase in court liquidations, accounting for about 55% of those appointments during the year.

The data also indicate a change in the lender base involved in distressed cases. Most receivership appointments were linked to loans held by alternative and international lenders, while pillar banks were the lender of record in just 2% of corporate receiverships.

James Anderson, Turnaround & Restructuring Partner at Deloitte Ireland, said: "The dynamics of corporate insolvencies in Ireland are changing. In 2025, there was a decrease in CVLs (company-led closures) and a simultaneous increase in creditor-led enforcements. A notable trend within this shift is the rise of alternative and international lenders, which is helping to drive this change."

Deloitte expects insolvencies to edge higher in 2026, forecasting 900 cases. The quarterly pattern in 2025 was relatively steady, with 206 appointments in the first quarter, 201 in the second, 211 in the third and 194 in the fourth.

Sector pressure

Small and medium-sized businesses remained the most exposed to insolvency, reflecting higher operating costs, limited working capital and continued difficulty servicing debts carried over from the Covid-19 period.

The services sector accounted for the largest share of cases at 43% of all insolvencies. Hospitality followed at 16%, or 129 cases, broadly in line with the previous year's 17% share.

Within hospitality, restaurants and cafés made up 70% of insolvencies. Retail accounted for 12% of insolvency activity, with 97 cases, unchanged in absolute terms from 2024.

Other sectors recorded smaller shares. Construction accounted for 10% of cases, manufacturing 7%, transport 3%, wholesale 2% and IT 2%, with the remainder spread across other business activities.

Anderson said: "While I don't anticipate a significant change in insolvency numbers in 2026, ongoing cost challenges will continue to disproportionately affect SMEs in the hospitality and retail sectors. The VAT rate cut scheduled for July 2026 is unlikely to reduce insolvency rates, with labour-related costs, overheads and energy costs continuing to affect business viability."

The figures suggest tax changes alone may not be enough to ease pressure on food and accommodation businesses. Labour costs, energy bills and other overheads continue to weigh on margins, even as a lower VAT rate for hospitality is due to take effect later in 2026.

Rescue process

The Small Companies Administrative Rescue Process, known as SCARP, continued to see limited use. There were 23 SCARP appointments in 2025, down 23% from 30 in 2024.

The process was introduced to offer smaller viable but insolvent businesses a simpler restructuring route. The figures suggest take-up remains below initial expectations, despite a high success rate among cases that do proceed.

Anderson said: "SCARP activity levels in 2025 reduced by 23% to 23 cases, from 30 in 2024, indicating that the process is not having the desired effect for smaller companies. While the success rate remains high, with more than 250 jobs saved through successful SCARP schemes in 2025, take-up remains well below the levels intended when it was introduced in 2021."

Regional split

Leinster remained the centre of insolvency activity, accounting for 73% of all appointments, or 594 cases. Munster represented 19% with 157 cases, while Connacht had 49 cases or 6%, and the Ulster counties in the Republic of Ireland accounted for 12 cases or 2%.

Dublin alone made up 61% of insolvency appointments during the year, underlining the concentration of company failures in the capital and surrounding region.

Overall, 2025 was marked by relative stability in total numbers but a clear shift in who is initiating formal insolvency processes, with tax authorities, alternative lenders and international lenders playing a larger role in enforcement activity.