UK Restaurant Insolvency Statistics

Insolvencies among restaurants and mobile food service businesses were broadly falling in the January to June 2026 period, with 1,011 cases compared with 1,078 during the same months of 2025, a fall of 6.2%. That contrasts with accommodation and food service overall, where insolvencies fell 7.5% over the same period.

Restaurants and mobile food service businesses accounted for 63.9% of all accommodation and food service company insolvencies in the January to June 2026 period (1,011 of 1,581 cases), up from 63.1% over the same months of 2025.

In the cases we see, restaurant insolvency rarely starts with one disastrous month. More often, the business absorbs rising food, wage and energy costs for too long, then uses tax arrears, supplier credit or short-term borrowing to cover the gap.

By the time directors seek advice, the dining room may still look busy. The more useful test is whether each week’s trading leaves enough cash to meet the next payroll, VAT payment, rent demand and supplier run.

Early advice matters because the available options narrow quickly once suppliers place accounts on stop, HMRC begins enforcement action or a landlord takes steps to recover the premises.

Accommodation and food service had the highest company insolvency rate among the largest UK industries in 2025, at 268 insolvencies per 10,000 businesses. The sector has recorded the highest rate every year since 2015, although the rate has fallen from its 2023 peak of 314 per 10,000.

This rate covers accommodation and food service as a whole and must not be read as a restaurant-only failure rate. It does, however, show that restaurant businesses operate within a sector where formal insolvency remains unusually common.

Restaurants are one of the largest sectors on this site by insolvency count, so the monthly trend is more stable than a small sector’s, but single-month moves can still reflect one-off closures rather than a shift in conditions.

The count is a volume, not a failure rate. It is not adjusted for how many restaurants are registered, so it cannot be read as a sector-wide risk of insolvency.

This is restaurants and mobile food service only (SIC 561). Pubs, bars and hotels sit under separate SIC codes and are not included here.

A fall in industry insolvencies does not make an individual cash-flow problem less urgent. If a restaurant cannot meet payroll, VAT, rent or supplier payments as they fall due, the useful question is whether the underlying trade is viable before debt repayments and arrears.

Acting early gives directors more scope to negotiate a Time to Pay arrangement with HMRC and agree terms with landlords and suppliers.

It also leaves room to consider a formal rescue procedure such as a Company Voluntary Arrangement or administration.

Once a winding-up petition, forfeiture action or supplier stoppage begins, those choices narrow quickly, and creditors’ voluntary liquidation may be the only realistic route left.