Phone 4u collapse to cost taxpayer £80m
TAXPAYERS stand to lose almost £80m following the collapse of mobile phone operator Phones 4u.
Administrators picking through the remnants of the business have said the retailer owed more than £69m in VAT and £8.8m in corporation tax when it collapsed in September. However, it is though only a tiny fraction of this may be recovered.
A report in The Daily Telegraph said the debts to HMRC were part of £168m owed by the company to unsecured creditors. It says administrator PwC believes less than 0.4% of this will be recovered – equal to £672,000.
These debts included £4.8m to Phones 4u customers, many of who had pre-ordered new phones only to not receive them. Other debts include £42m to suppliers, £25.9m to employees and £17.2m in unpaid bills.
The newspaper said it had seen the administrators’ report and the document exposed the massive problems created by the retailer in its final days.
Thousands of jobs were lost and hundreds of stores around the country forced to close following the collapse of the business.
Subsequent parts of the Stoke-on-Trent-based business have been acquired by other retailers and phone companies. Despite the failure of the business, the Manchester arena still carries the Phones 4u brand name.
