Insolvency specialists Clarke Bell have revealed a significant spike in Members’ Voluntary Liquidations (MVLs), with the firm finalising nearly four times more solvent liquidations in February 2025 compared to January.
The sharp rise points to a shift in director confidence, with many choosing to close solvent businesses and extract capital amid ongoing economic volatility and a stable tax regime. The uptick follows the government’s Spring Statement, which has left some business owners feeling unsupported in the short term.
John Bell, Director at Clarke Bell, said: “The increase in MVL activity suggests that more directors are opting to take proactive steps in the current economic climate. Uncertainty around future tax changes, combined with rising business costs, is prompting many to review their position and plan ahead.”
Spring Statement Spurs Business Owners to Rethink Strategy
Delivered in March 2025, the Chancellor’s Spring Statement presented a forward-looking agenda focused on long-term investments in defence, housing, and digital infrastructure. However, many in the business community were disappointed by the lack of immediate relief measures for SMEs grappling with cost pressures.
With employer National Insurance hikes, a higher National Living Wage, and continued inflation, many directors are finding it increasingly difficult to justify ongoing operations, particularly in the absence of short-term policy support.
Industry feedback has been consistent in highlighting that while long-term reforms are positive, many businesses needed urgent measures to stay afloat or reposition.
MVLs Becoming a Strategic Exit Route
A Members’ Voluntary Liquidation enables a solvent company to formally close, with funds distributed to shareholders. The surge in February suggests that more directors are opting to retire, merge, or streamline operations in response to the economic headwinds.
Clarke Bell’s latest figures mark a sharp departure from the relatively steady MVL activity seen over the past year, underlining a more decisive shift in director behaviour.
John Bell added: “While many companies are continuing to trade successfully, others are reaching a natural endpoint. We are seeing more directors assessing their business plans and deciding that, for various reasons, this is the right time to close their company. That may be influenced by tax considerations, succession planning, or simply wider economic uncertainty.”
Mixed Signals for Remainder of 2025
With the Autumn Budget and Comprehensive Spending Review on the horizon, many company owners are expected to reassess their financial strategies. Potential adjustments to Capital Gains Tax or Business Asset Disposal Relief remain key concerns for those looking to unlock value from their businesses.
Clarke Bell’s February MVL data indicates that this pattern of solvent company closures could continue if current economic and legislative conditions persist.
