Insolvency by the Numbers #55: NZ Insolvency Statistics June 2025 Below we outline the insolvency figures for June 2025 when compared with the last few years across personal and corporate insolvency. Winding Up Applications As we mark the half way point for the year the insolvency figures follow their normal trend of a slight drop before heading upwards towards Christmas, this is in part driven by people pushing to get things done in the 2nd half of the year and a lack of public holidays delaying mattes. While not back into the triple figures seen at the start of the year the June figures were inline with what was expected for winding up applications. Creditors, particularly IRD, continue to apply…

When the IRD Comes Knocking: What Company Directors Need to Know No business owner wants to see a letter from the Inland Revenue Department (IRD) land on their desk especially when the business is already under financial pressure. But whether it’s a late payment notice, an audit notification, or a formal demand, how you respond can have serious implications for your company and you personally as a director. Here’s what to know when the IRD comes knocking, and how early engagement with a licensed insolvency practitioner can help protect your business, assets, and reputation. Why IRD Debt Matters More Than Most IRD isn’t just another creditor. It has stronger enforcement powers than most including the ability to: Garnish funds directly…

KiwiSaver and Bankruptcy: A Recovery Option for Creditors Pre-Bankruptcy. New Zealand's KiwiSaver scheme, introduced in 2007, has become a cornerstone of the country's retirement savings framework. However, when financial difficulties arise and bankruptcy looms, both debtors and creditors face complex questions about how KiwiSaver funds are treated in insolvency proceedings. This article explores the intersection of KiwiSaver and bankruptcy law, with particular focus on recovery options available to creditors before formal bankruptcy proceedings commence. If an individual is adjudicated bankrupt in New Zealand, their assets vest in the Official Assignee (OA) for the benefit of creditors. One of the exceptions to this rule is the individual’s KiwiSaver. Despite being considered an asset under the Insolvency Act, the OA cannot access…

Insolvency by the Numbers #54: NZ Insolvency Statistics May 2025 May 2025 saw another OCR drop of 0.25 basis points during the month, despite calls for a larger drop. The property market remains subdued and a buyers’ market, in addition housing stock availability continues to rise, anecdotally there appear to be a lot of recently completed townhouses sitting there unoccupied and awaiting sale. Business confidence remains low. Below we outline the insolvency figures seen in May 2025 when compared with the last few years across personal and corporate insolvency. Winding Up Applications The bounce back from last month’s public-holiday lows saw May just shy of the triple figures we had predicted. The May winding up figures were above the level…

In today’s volatile economic climate, companies across industries are navigating increasing financial pressure. Rising interest rates, supply chain disruptions, and margin erosion are converging to place directors and business advisors under heightened scrutiny. Now, more than ever, proactive advice from a licensed insolvency practitioner (LIP) can be the difference between a successful turnaround and a forced wind-up. Whether you’re a director, accountant, or legal advisor, understanding when and why to involve an insolvency professional is vital to protecting your client's (or your own) business, assets, and reputation. The Power of Proactive Advice Licensed insolvency practitioners are not just “last resort liquidators.” They are restructuring and risk management specialists trained to assess a business’s position, preserve value, and advise on compliant…

A guide for directors on what really happens in insolvency—and how to protect yourself. In closely held or family-run businesses, it’s common for directors and shareholders to move money in and out of the company whether as loans, drawings, or transactions with related entities. These practices often feel routine, but in an insolvency scenario, they can become the focus of intense scrutiny and even personal liability. Understanding how these transactions are treated when a business fails is essential for any company director. Here’s what you need to know. Director Loans: Not as Simple as They Seem Directors often treat loan accounts as flexible cash flow tools drawing funds when needed, or injecting capital during tough periods. But unless documented properly…

If there was a cliff for the insolvency figures to jump off it would be called “Public Holidays” and they have effects across the board this month, but people taking 10 days in a row off will do that. April felt suspiciously like Christmas where you have a month’s work to do in half the time, so naturally some things get put off to next month. Coupled with the shorter month we also had global factors playing havoc with the economy and adding to the uncertainty for businesses, a number have started to take the wait and see approach to see what washes out rather than taking action to deal with problems they are facing. Winding Up Applications April saw…

The escalating tariff regime between the United States and China continues to cast long shadows across global trade routes—and New Zealand is far from immune. With the U.S. implementing new or increased tariffs on Chinese goods, the indirect consequences are set to impact a range of New Zealand industries, raising the risk of insolvency in already vulnerable sectors. Indirect Shockwaves: How U.S.-China Tariffs Affect NZ New Zealands economy is deeply interconnected with both the U.S. and China. The tariff regime creates cost distortions, re-routes global trade flows, and introduces volatility to commodity markets. These dynamics are especially relevant for New Zealand exporters, importers, and manufacturers. Industries most at risk include: Exporters of Raw Materials & Agricultural Commodities: A slowdown in…

In the life cycle of a company, disputes between shareholders or directors are not uncommon. Tensions may escalate due to differing visions, a breakdown in trust, or major life events—like the death of a key shareholder-director. When parties are no longer aligned and cannot find a viable path forward, liquidation is often seen as a last resort. But it can also be a strategic tool for resolving conflict and unlocking value in a deadlocked business. When Business Relationships Break DownMany small-to-medium enterprises (SMEs) in New Zealand are closely held, often by friends, family members, or long-time business partners. These relationships can deteriorate over time due to: Disagreements on strategy or financial direction Disparities in workload or contribution Retirement plans or…

Winding Up Applications Yet another month where we saw a drop in appointments when compared to the prior month, but we remain above the prior year March figures. Traditionally we would see a drop in March before we begin the climb to the mid-year highs, coupled with the end of financial year keeping creditors distracted with other matters. The winding up notices advertised still present a strong showing for the month, with triple digits for each month in the first quarter of 2025. It suggests we will continue to see this increased level of creditor activity for the rest of the year. While the appointments since January have been decreasing, as a cumulative total we remain above the totals in…

Winding Up Applications February applications were down on January but still above what we saw in 2024. Historically February would be a bumper month as the winding up notices that couldn’t be processed in January would spill into February. Regardless it was still a strong showing for the month and is setting the tone for what we expect to see in the rest of the year. IRD made up 78 of the 118 appointments for the month and continued applying the pressure to derelict debtors. The IRD has continued with its 23-month streak of having more applications than all other creditors. The last time they made less applications was back in March 2023. I have also included the trend line…

For many businesses, receiving a statutory demand from the Inland Revenue Department (IRD) can be an alarming and stressful experience. It signals that the company has unpaid tax obligations and that the IRD is taking formal steps to recover the debt. If left unaddressed, this can quickly escalate into a winding-up application, resulting in the company’s liquidation. This article outlines what businesses should do when served with a statutory demand by the IRD and how to respond when an instalment proposal is rejected. Understanding a Statutory Demand A statutory demand is a formal notice issued under section 289 of the Companies Act 1993, requiring a company to pay a debt within 15 working days. Failure to comply creates a presumption…