What is Phoenixing?
Phoenixing occurs when a director closes one entity and quickly establishes another with the same or similar operations — often to avoid paying debts, employee entitlements, or taxes.
This practice can mislead creditors, damage industry trust, and create unfair competition in sectors where it occurs.
Industries Affected
While phoenixing can occur in any sector, it is most common in industries with high turnover and subcontracting activity, such as:
Construction and building
Labour hire
Transport and logistics
Cleaning and maintenance services
These industries face greater exposure to directors who repeatedly set up new entities to avoid financial or legal responsibilities.
Webinar: Understanding Phoenixing Activity
The webinar below explores:
What phoenixing activity looks like
Which industries are more exposed to this behaviour
Real-world examples of phoenixing activity
Why Awareness Matters
Recognising phoenixing activity helps reduce credit risk and protect your entity from engaging with unreliable or fraudulent operators.
Monitoring director behaviour and verifying entity histories are key steps in reducing exposure to potential phoenixing.
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