But when presented with the deed of company arrangement, Mader said the ATO opposed it in favour of placing the company in liquidation, which would have involved selling off its assets and dissolving the business as a means of recouping the debt.

“We just couldn’t understand why – we still had about 60 employees who stuck by us through this process,” he said.

“The DOCA [deed of company arrangement] stated that everything would be lodged on time and that our debts would be paid in full … to prefer liquidation to letting us trade out was just bizarre.

“Yes, we had a sizable debt, but we had paid millions of dollars in tax over the years.”

Mader managed to get the deed over line, with PSS exiting administration earlier this month.

But the threat of being wound up is one facing a growing number of West Australian businesses as the tax office abandons its pandemic-era concessions and takes its battle for unpaid debts to the Federal Court.

The ATO relaxed its debt recovery regime during the pandemic amid fears the virus and the subsequent lockdowns could wreak havoc on the economy, offering a host of concessions, payment plans and remitted penalties.

But it now says the leniency led to a change in payment culture, with more…