Purplebricks Hit with HMRC Winding Up Petition

Purplebricks hit with winding up petition from HMRC over administrative error

Online estate agent Purplebricks has defended its accounting practices after being served with a winding up petition by HM Revenue and Customs, an action the business stated was caused by an administrative error.

Legal filings showed HMRC served the court petition on Tuesday. Winding up petitions are typically filed by the tax authority over tax liabilities that remain unpaid for longer than 21 days. Although such petitions can result in the forced sale of company assets in rare cases, most corporate litigants resolve outstanding claims before reaching that stage.

Purplebricks, backed by entrepreneur Sir Charles Dunstone, expressed surprise at the speed of the tax authority's action.

"We were surprised by the petition from HMRC," a spokesman for the company said. "We were in active dialogue on an admin error and only became aware of the filing of the petition once it had been submitted. To be clear, our liability for taxes as they are due have been dealt with and the petition is being withdrawn."

Accountancy firm BK Plus, which advises the company, confirmed in a letter that the issue with HMRC was an administrative error and noted that the matter had been resolved.

The petition has nevertheless drawn attention to the financial reporting timeline at Purplebricks, following its failure to file annual accounts for the year ending March 2025 on time.

A company spokesman explained that the delay in filing was due to the appointment of a new chief financial officer, adding that the company plans to submit the accounts in the coming week.

"Our new leadership team have made big strides in the turnaround of Purplebricks and we are experiencing growth in all areas of the business," the spokesman said. "We remain fully focused on delivering for our customers and continuing to be the most innovative estate agency business in the UK."

Founded in 2012 by brothers Michael and Kenny Bruce, Purplebricks grew rapidly by offering flat fee property sales as an alternative to traditional high street brokers. Once backed by fund manager Neil Woodford, the business listed on the London stock market at a valuation of 1.3 billion pounds. It subsequently encountered financial difficulties following an unsuccessful expansion into Australia.

Sir Charles Dunstone, who is also a backer of broadband provider TalkTalk, acquired a stake in the business through his Strike venture in a deal with a nominal valuation of 1 pound.

Addressing its debt recovery procedures, an HMRC spokesman 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."

Source: The Telegraph