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Insolvency advice for pub landlords and bar owners

Licensed UK Insolvency Practitioners FREE Meeting for Company Directors

We can help with serious company debts, HMRC and creditor pressure, VAT/PAYE/Tax arrears, cashflow problems and raising finance.

Insolvency advice for pub landlords and bar owners

Reviewed: 8th January 2018

According to a report by Ortus Secured Finance, the number of pub and bar business insolvencies has risen to 482 during 2016/17 – an increase of 9% from the previous year.

Some of the causes of this downturn can be attributed to the general economic conditions experienced by other industries, including increased rents and business rates, but what sector-specific issues might pub landlords and bar owners be dealing with?

  • Inflexible leases and tenancy agreements -Some pub leases and tenancies are characterised by lack of flexibility, with restrictions and limitations on where stock can be purchased.
  • Smoking ban - The BBC reports that the smoking ban, introduced in 2007, may have been a key factor in pub closures – between 2007 and 2015, almost 7,000 pubs in the UK closed down.
  • Rises in the duty on alcohol - Although the duty on most types of alcohol was frozen in the Autumn Budget 2017, the BBC report a rise in beer duty of 42% between 2008 and 2013.²
  • Strong competition from other sources - The low price of alcohol in supermarkets has created strong competition, with some consumers preferring to purchase cheaper alcohol from a supermarket or off-licence and drink at home before going out to a pub or bar, simply to reduce their costs.
  • Change in drinking trends - Drinking trends have changed over the last few years, with a rise in the popularity of wines and spirits, and new artisan beers and ciders taking precedence over ‘traditional’ ales.
  • Lower disposable incomes - With rising consumer prices and static wages, lower disposable incomes have been a significant factor in pub and bar insolvencies over recent years.

The freeze on most alcohol duty in the 2017 Autumn Budget was said to be in recognition of the integral part played by pubs as part of the fabric of our country, and of the industry as a whole in helping to boost the economy. 

But this is a small glimmer of hope for pub landlords and bar owners operating in an industry where uncertainty and financial struggle is currently the norm. So how can we help when your pub or bar business is facing financial decline?

Free insolvency guidance for pub landlords and bar owners

Our main aim when working with clients is always to achieve business rescue where possible. We offer a free same-day meeting to discuss the situation, and identify potential options.

These could include, but are not limited to:

An injection of additional finance

We have professional contacts with over 50 alternative lenders around the UK, and can provide support in sourcing and applying for vital additional funding. This could help you pay your bills as they fall due – a particularly important issue if HMRC is involved, as they have the power to take action quickly in recovering arrears of tax, National Insurance, and VAT. We can also help you negotiate with HMRC for extra time to pay.

Negotiating an HMRC Time to Pay Arrangement (TTP)

It may be possible to arrange an extended period of time in which to pay any HMRC arrears. This is generally between three and six months, although instalment plans covering a full 12 month period may also be available in some cases.

Negotiating and administering a Company Voluntary Arrangement (CVA)

A CVA is a formal insolvency solution that allows eligible businesses to make a single monthly repayment to creditors, which is then distributed by the appointed insolvency practitioner according to this legally-binding arrangement. Company Voluntary Arrangements allow you to carry on trading once they’ve been set up, and are intended to help you return to profitability over the long-term.

Carrying out a Creditors’ Voluntary Liquidation (CVL)

If the business has been assessed, and is not viable for the future, you can protect your creditors’ interests by instigating a voluntary liquidation of the business. A CVL prioritises creditors, and can also be a beneficial route for directors of pub and bar businesses who are worried about personal liability.

Real Business Rescue are specialists in the pub and bar sector, and will provide the professional support you need. This could include help to complete and submit an alternative finance application, or perhaps to negotiate on your behalf with creditors.

Our extensive experience of creditor negotiations instils confidence in your ability to repay, and is especially beneficial when dealing with a large creditor such as HMRC. Let us help you survive the downturn and regain your footing in your industry – call one of our licensed insolvency practitioners to arrange a free same-day meeting at your own business premises, or with 55 UK offices nationwide.   


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