By John Burns
Copyright independent
Energy bills and the cost of recruiting specialist staff are the primary factors that affect business success in the sector, according to Deloitte Ireland.
Restaurants are being disproportionately affected by financial collapse, its research has found, with the hospitality sector suffering 103 insolvencies in the year to date out of a total of 618.
“Restaurants, in particular, are facing significant cost challenges that are making their businesses unviable,” said James Anderson, a partner at Deloitte Ireland specialising in restructuring.
“The Vat rate cut that has been signalled as a part of the upcoming budget that is just days away is unlikely to change insolvency rates in the sector.”
Small and medium-sized businesses are being hit hardest by insolvency, while the hospitality, retail and construction sectors together are accounting for 38pc of all corporate failures.
The 618 corporate insolvency appointments recorded in the first nine months of 2025 represent a 5pc decrease compared to the same period in 2024, according to Deloitte.
This means that the closure of Revenue’s debt warehousing scheme in May 2024 has not had the long-term negative impact that was initially feared. After the scheme closed, demand notices were sent to 11,724 parties who had not engaged with Revenue about their outstanding debt.
Some 7,042 of those did not reply, and their debt was then subject to the usual collection and enforcement process.
Based on the numbers to date, and the consistency between the different quarters this year, Deloitte believes that there will be between 825 and 850 corporate insolvencies in total for 2025.
Court-appointed liquidations increased by 107pc year-on-year, with 85 in the first nine months. Creditor-led petitions accounted for almost three-quarters of those, with Revenue accounting for the majority.
Company-led closures, via creditors’ voluntary liquidation, were down 22pc compared to the same period last year.
Restructuring activity – both examinerships and the Scarp process – increased by 36pc on the same period in 2024, but the numbers were still low, at just 38.
The Small Companies Administrative Rescue Process (Scarp) was introduced at the end of 2021 to help firms that were financially sound but in temporary -difficulties with creditors.
