A party supply business set up by Kate Middleton’s parents collapsed owing £2.6million to suppliers, lenders and the taxman, it has been revealed.

That’s according to administration filings about the company Party Pieces Holding, which was founded by Carole and Michael Middleton in 1987.

Last month it tumble into administration and blamed the impact of the pandemic on the party market and pressure from the cost-of-living crisis for its failure before being immediately sold to entrepreneur James Sinclair in a pre-pack administration deal.

One of the companies suppliers, Sultani Gas, which is based in Tonbridge, are “appalled” by the news.

A spokesman for the owners said: “What hurt me the most was that I trusted her as the mother-in-law of the future king — and she just betrayed me. It is absolutely unacceptable.”

Party Pieces saw its revenues shrink to £3.2 million last year from £4.5 million in 2021, and slid to a £900,000 net loss before tax as a result.

A report from administrators at Interpath Advisory said they were hired and oversaw the rescue sale after previous takeover attempts could not be agreed.

The report said the firm had an estimated £197,739 worth of assets to return to preferential creditors.

The company, which had only 12 employees at the time of its administration, owed £612,685 in tax.

Its debts including an outstanding debt of £218,749 to Royal Bank of Scotland related to a coronavirus business interruption loan.

Meanwhile, trade creditors – which included Royal Mail, Google and Solihull Moors Football Club – were owed a total of £456,008.

The success of the company helped make the Middletons into millionaires, with the Princess of Wales even working for her parents at one time.

She was featured on the Party Pieces website in March 2010 when she posted some light-hearted comments about her childhood.