There could soon be a baked goods showdown to rival M&S and Aldi in the caterpillar wars, but this time involving the taxman.
HMRC is taking bakery chain Wenzel’s to court over unpaid debts.
The government agency has filed a winding up petition, a last resort to forcibly liquidate a company so that it will be able to pay the money it owes.
The news on the legal action led to fears that its more than 100 branches may have to close – but the business said they were expecting to work things out soon.
A Wenzel’s spokesperson told Metro: ‘The winding up notice is in relation to ongoing discussions with HMRC regarding an outstanding balance, however, we are actively engaged with HMRC and expect this matter to be resolved shortly.
‘We do not expect any redundancies, we do not expect any store closures.’
Depending on where you live in the UK, you may either be a regular visitor to Wenzels the Baker, which has 109 stores, or have never heard of them in your life.
Those in north west London, where the business was born, are most likely to have a branch within easy reach, but they can be found as far afield as Bournemouth, Chelmsford and Northampton.
In some areas, they are so concentrated that they rival Greggs as the go-to high street bakery, though there are zero north of Birmingham or west of Weymouth.
Wenzel’s formed as a family-run business in 1975 and since then has steadily expanded, opening nine new locations last year.
But since then, it has been hit by tough trading conditions that even saw Greggs shares dip.
The Daily Mail, which was first to report on the tax problems, said the winding-up petition was launched on March 19.
It comes after the company saw a £4 million decrease in profits in the year to March 31, 2023, making £1.6 million compared to £5.6 million the previous year, according to its most recent public accounts.
What is a winding-up petition?
People can apply to a court to close down or ‘wind up’ a company if it cannot pay its debts.
They must be owed £750 or more and be able to prove that the company cannot pay.
A ‘winding-up petition’ is the name of the application to the court. If successful:
- the closed-down company assets are sold
- the company collects money it’s owed
- funds are paid to creditors, where possible
The application costs £332 in court fees and £2,600 as a petition deposit, to manage the process.
Those who apply for one might be able to get the fees back later if the company can afford to repay them.
Source: gov.uk
Wenzel’s, whose website says its ‘love language is offering to-die-for bakes at to-live-for prices’, has until the end of the month to submit its latest accounts for the year running to March 31, 2024.
An HMRC spokesperson said: ‘We take a supportive approach to dealing with customers who have tax debts and only file winding-up petitions once we’ve exhausted all other options, in order to protect taxpayers’ money.’
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