Fate of Jim’s Plumbing franchisor still unclear as tax bill saga continues

The fate of the company which runs the Jim’s Plumbing franchise is still in question, with Jim’s Group founder Jim Penman confirming that the company is still to pay a tax bill which led the Australian Taxation Office to lodge a wind-up notice against Jim’s Plumbing last month.

While Jim’s Plumbing operates under the banner of the giant franchise empire Jim’s Group, the rights to use the name were owned by an Adelaide-based company run called Jim’s Plumbing (Aust) Pty Ltd, which is headed up by David Ellingsen.

Jim’s Group founder Jim Penman withdrew the rights for the use of the Jim’s Plumbing name after he became aware of the unpaid tax bill, and is now leasing those same rights back to Ellingsen on a temporary basis.

Penman confirms the company is still operating and says a permanent franchising agreement will be established after the tax issue has been dealt with.

“We are leasing the rights back now,” Penman says. “The company got into short-term financial difficulties, and now the company has been turned around. But we don’t want to see the company destroyed altogether.”

The ATO last month issued a wind-up notice against Jim’s Plumbing (Aust) Pty Ltd due to an unpaid tax bill. Both ATO solicitor Ben Williams from Hunt & Hunt, and Ellingsen were contacted by SmartCompany this morning.

While Ellingsen was unavailable prior to publication, Williams said he was unable to comment as the matter is now before the courts.

Penman says while the company had run into some trouble, he now believes it is profitable.

“David just allowed it to expand too fast, and did more than he could. The amount of the bill is small, but it seems the Tax Office has just run out of patience.”

“The company is still operating, and still active. I don’t see why it should die, considering the customer service and so on is superb. We’ve had maybe three complaints ever with that business, and every time they’ve fixed it. They’re very good.”

While Penman says he is unable to provide a timetable for when the tax bill might be paid, he says he is confident Ellingsen will be able to come to an agreement.

“He allowed the company to expand too fast, but he’s got it back under control and it’s operating profitablly. I see reason to believe it, as he was just expanding too fast. He was rolling out the business across the entire company.”