Tens of thousands of firms are on the verge of collapse as a £27billion tax crackdown threatens to tip struggling ‘zombie’ businesses over the edge, according to a bleak report. Research from advisory firm Begbies Traynor showed the number of companies in ‘critical financial distress’ hit 67,369 in the last three months of 2025. And more pain is to come, especially for so-called ‘zombie’ firms that have managed to stagger on with the help of Covid support but are now in peril as HM Revenue and Customs looks to recover taxes overdue from the pandemic. It echoes a recent report from the Resolution Foundation think-tank that a ‘zombie apocalypse’ of such firms could be on the way. Ric Traynor, executive chairman of Begbies Traynor, said: ‘The continued rise in critical financial distress is clearly concerning for the UK economy.