Collapsed Bells Creek builder Reliance Walls & Ceilings’ subsidiaries owe ATO more than $1m amid industry downturn

Three subsidiaries of a Sunshine Coast construction company owe the ATO more than $1m after being placed into liquidation as the industry grapples with the Covid-19 fallout.

Three subsidiaries of a struggling Bells Creek building company have collapsed owing the ATO more than $1m amid the ongoing downturn for businesses in the construction industry nationally.

Reliance WC Pty Ltd, Reliance WC (Qld) Pty Ltd, and Reliance Builders (Qld) Pty Ltd were placed into liquidation on April 8 by BDO Cairns liquidator Todd Kelly.

The three businesses founded in October, 2018 ceased trading in November, 2021 and came under home builder Reliance Walls & Ceilings’ stable of five entities with the remaining two still in operation.

ASIC reports on company activities and property for the three businesses show Reliance WC Pty Ltd owed 11 creditors more than $300,000 with unrelated creditors including $74,873 to the ATO, $5331.24 to Farrago Interiors in Bells Creek, and $6361.69 to Revolution Wood Panels in Brendale.

Reliance WC (Qld) Pty Ltd had related debts of about $1.45m to its other two collapsed counterparts along with unrelated creditors which consists of $176,518.88 to the ATO, $18,567.25 for Ascendia in Noosa Heads, and $382.80 for UFE Services Pty Ltd based in Victoria.

The business has about $50,000 in outstanding superannuation entitlements to its employees.

Reliance Builders (Qld) Pty Ltd has unrelated creditors including the ATO for $997,205.03, Australian Training Works in Brisbane for $6076.39, and Caps Door Hanging in Browns Plains for $760 as well as about $66,000 in outstanding superannuation entitlements.

Construction companies throughout Queensland and nationally are feeling the pinch of supply chain disruptions and rising labour costs.

The QBCC licensee history for Reliance WC (Qld) Pty Ltd show its licences for drywall plastering and carpentry were suspended on April 13 this year for failing to comply with annual reporting conditions and had a maximum revenue between $800,001 and $3m.

Reliance WC Pty Ltd had its licences for drywall plastering and carpentry cancelled from December 13, 2021.

Each of the collapsed subsidiaries cited “poor economic conditions and trading losses” as the primary reasons for their downfall in submissions to BDO Cairns.

Liquidators were still in the process of determining the number of staff across each of the three companies and the exact nature of the construction work they undertook.

The director of Reliance Walls & Ceilings Pty Ltd declined to comment on the matter.

The business’ collapse comes amid turbulent conditions for small to large builders in Queensland and across the country which are facing supply chain disruptions, rising import and labour costs following the onset of Covid-19 lockdowns and restrictions.

Prominent Sunshine Coast construction company BA Murphy went under in December with debts to creditors exceeding $11m.

Narangba glass door and window maker Hitec Glazing went into liquidation in March this year which employed more than 130 staff and left three Sunshine Coast companies nearly $100,000 out of pocket collectively.

In February, Probuild collapsed owing $14m to 800 workers after it was placed into voluntary administration by its South Africa-based parent company Wilson Bayly Holmes-Ovcon Ltd (WBHO).

Industry experts tip more financial struggles to come for builders this year.