The Pratt family’s long list of court battles is getting longer, with news that the family is involved in a $220 million battle with the Australian Taxation Office over tax bills and penalties.
According to a report in the Australian Financial Review, the family’s empire of companies are contesting ATO claims’ that $180 million generated by the companies should be declared as assessable income.
The family is also seeking to overturn almost $12 million in tax penalties and will attempt to argue it should be able to carry forward tax losses from 2002 to offset against its tax bills. The legal battle relates to tax assessed during a period from 1999 to 2003.
The tax fight adds to a growing list of court matters the Pratt family is involved in.
In May 2010, the late Richard Pratt’s mistress Shari-Lea Hitchcock lodged a claim to contest his will. While Pratt and Hitchcock’s daughter Paula reportedly received property and cash in Pratt’s will, Hitchcock is seeking further sums.
One month after Hitchcock lodged her claim, former model and escort Madison Ashton, lodged another claim against the estate, saying she also had a relationship with the packaging billionaire.
Ashton has claimed Pratt reneged on a contract to set up $2.5 million trust funds for each of her children and pay her an annual retainer of $500,000 for her upkeep.
The Pratt family is still fighting both claims.
According to the AFR’s reports, the Pratt family objected to the ATO’s tax bills in 2008, but these objections were rejected in November last year.
However, like most tax battles that wind up in court, the Pratt’s stoush is likely to take a number of years to resolve.
A Pratt family spokesperson was unavailable for comment prior to publication.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
