Yugo Canteen offers 15 cents to the dollar to the ATO settle $1M debt
Yugo Canteen, which operates Junk at Maroochydore and Sippy Downs on the Sunshine Coast has offered the Australian tax Office (ATO) 15 cents in the dollar to settle a debt of almost $1 million.
According to a document filed with Australian Securities and Investments Commission (ASIC), the company owes the ATO $959,634.87.
The debt to the ATO is more than 96 per cent of a total of $997,236.14 owed to creditors, with the Queensland Revenue Office the next largest creditor, owed $27,042.84.
There are 15 other creditors owed three and four-figure sums, who will choose to accept or reject a restricting plan which has been put to them.
Under the restructuring plan, Yugo Canteen would pay $165,000 in 24 monthly instalments – or 15.04 cents in the dollar – to wipe its debts.
Yugo Canteen director Scott Hoskins clarified that the company is currently undergoing restructuring, not liquidation or administration. He explained that financial difficulties began during the COVID-19 pandemic and were worsened by a drop in revenue linked to the rising cost of living.
Hoskins added that he had committed to leasing the Junk premises at Sippy Downs before the pandemic began.
“When covid came about, that got delayed but we still had made that commitment and our building costs increased by the time we were able to do it,” he said.
“That took three times the time to build and our cost to build the restaurant was about $1m.”
Hoskins shared that during COVID, he sought rent relief from Junk's landlord in Maroochydore. While he received conditional support, it required him to sign a new lease that included a mandatory refurbishment, adding to the company’s expenses.
He noted that the company’s recovery from these significant costs was further hindered by a 25% decline in revenue this year compared to last. When faced with the choice between paying the tax office or sustaining his business, he chose to prioritize keeping the business going.
“I’ve put everything into these restaurants. These restaurants feed 45 families,” he said.
Jonathan Jackson, 13th November 2024
