According to figures from the Insolvency Service, 1,252 company directors have been disqualified in the past financial year, making a rise of 9%. The average length of disqualification has also increased to a record 6.5 years.

Under disqualification orders, individuals can be banned from working as directors or taking part in the creation or promotion of a limited company for a maximum 15 years. They can also face imprisonment of up to two years if they fail to pay costs in bringing the disqualification proceedings.

Directors can be disqualified for not keeping correct accounting records, as well as not filing accounts on time. They can also be disqualified for criminal matters such as theft or fraud. 

Additional research by City law firm Wedlake Bell has revealed that whilst the most common reason for directors being disqualified is underpayment of tax, there has been a 72% rise in disqualification due to criminal activity in the last year.