Firm who ran Seaton Beach Cafe leaves £250k of debt with thousands owed to workers

The Seaton Beach Cafe in South East Cornwall

A waterfront cafe which shut suddenly left debts of more than £250,000 including thousands of pounds owed to workers. The Seaton Beach Cafe, in South East Cornwall, closed in November and the company operating it has gone into liquidation.

Owners of the building have reclaimed the property and begun work with a view to reopening the popular seaside venue. They are among creditors owed cash from the company Seaton Beach Cafe Ltd.

Documents filed at Companies House reveal Seaton Beach Cafe Ltd, incorporated in 2006, left estimated assets of £5,748, but a large amount of debt. The company’s statement of affairs shows the business had a huge unpaid tax bill and owed large sums of money to 26 staff members.

In total, £87,153 is owed to preferential creditors. More than £7,000 of this is due to the 26 staff members, mostly unpaid holiday pay, with £79,800 owed to HM Revenue and Customs for unpaid Income Tax and VAT. The assets left by the company will go towards paying preferential creditors but it will leave £81,405 unpaid.

The majority of the claims are from unsecured creditors, totalling £163,823. Of this £9,263 is owed to HM Revenue and Customs in unpaid Corporation Tax.

There is a claim for £36,000 from the cafe building’s landlord Purple Dot Directors Pension Fund, in Callington. The building, right on the beach at Seaton, is owned by a company run by the same people who own the nearby The Beach House restaurant. They had leased the cafe to unrelated entity Seaton Beach Cafe Ltd and are now claiming cash owed.

There is also an unpaid £25,797 Bounce Back Loan (BBL) from NatWest, which is also claiming for an overdraft of £12,486. The BBL scheme allowed small firms to borrow up to £50,000 at low interest rates, guaranteed by the Government, to help them recover from the Covid pandemic and its lockdowns. It has since been estimated that £19.7bn of BBL debt will end up being written off across the UK.

Workers are also claiming large sums as unsecured creditors, with redundancy payments owed to eight workers totaling £20,636. Pay in lieu of notice owed to 26 employees is totalling £20,379.

Among more than a dozen trade creditors, Caterfood, in Paignton, is claiming £18,656, and Cornish Tea and Coffee, in Liskeard, is short of £4,035. In total it is estimated that creditors will be left short of £245,228.

Meanwhile, the owners of the waterside building are keen to reopen the cafe but it requires extensive work first and may have even suffered flooding. A spokesperson for the owners said work to make the building fit for trading again could take as long as a year. But it is very much earmarked for reopening.

The Seaton Beach Cafe Ltd appointed liquidators at the end of January and was wound up voluntarily. Its Facebook page has been taken down and its website closed. PlymouthLive has attempted to contact the sole director of the company but has not had a response yet.