Sri Lankan street food operator The Coconut Tree, which this summer was set to be wound up after defaulting on its company voluntary arrangement (CVA) over an unpaid £1.6m tax bill, has been placed into administration.
Administrators have been appointed to the seven-strong group, which continues to trade in Cheltenham, Bournemouth, Bath, Reading, Oxford and two in Bristol.
In June, a notice showed the The Coconut Tree owed HM Revenue & Customs (HMRC) 1,360,837 in VAT and £239,799 in PAYE and national insurance contributions. HMRC has been paid £207,115 in relation to its secondary preferential claim, which was agreed in the amount of £1,600,636.
Unsecured creditors, who are owed an estimated £1,360,000, will receive nothing as a result of the CVA default. The notice showed that in February this year, The Coconut Tree failed to make payments relating to outstanding VAT and other tax, therefore breaching the terms of the arrangement. In March, the company requested a payment holiday for one month to enable recovery from missed sales projections for the months of January and February 2025. The holiday was granted, and the company was granted an additional month to rectify the breach. However, even with the extension, the company was unable to pay the arrears of VAT and other tax, which amounted to over £510,000, and it was therefore in default.
The Coconut Tree was founded in 2016 by five Sri Lankan friends living in Cheltenham – Mithra Fernando, Rashinthe Rodrigo, Dhanushka Fernando, Praveen Thangiah and Shamil Fernando.
Author: George Shaw
Former BBC journalist and founder and CEO of an award-winning London advertising and PR company for 20 years, providing restaurant consultancy services. Spent a decade as the director of communications of the Asian Catering Federation in the UK and lead judge for its various restaurant and chef awards programmes. Now returned to journalism, specialising in food and travel and currently the Editor-in-Chief for Taste London, Taste Asia, the Good Curry Guide and CEO of International Culinary Guides.