Sydney family battle tax office in court over claims they owe more than $200m

The Sydney property developer, in his 30s, had just three weeks to pay back a staggering tax bill.

Nobody likes getting a tax bill, but for one Aussie family they must have done a double take when they saw the eye-watering amount they were being ordered to pay back.

It came in at a cool $207 million, according to The Australian Financial Review.

The Wu family, an incredibly private Australian-Taiwanese family unit on Australia’s rich list, made their fortune through their supplement business Nature’s Care which sells to big retailers like Chemist Warehouse.

The company was founded by family matriarch Jina Chen in 1990 and her husband Alex Wu and sons Michael and Jack are now also involved in the business. Both sons are based in Sydney.

A large chunk of the company was sold to two investment funds with links to the Chinese Communist Party in 2018 with reports the sales figure was as high as $585 million.

In Federal Court proceedings lodged in 2023, the Australian Tax Office alleged that the family had under-represented the sale proceeds and as a result owe hundreds of millions to the taxpayer.

Their assets were frozen at the end of last year.

The family are fighting the claims and their legal representation noted in a court case last week that the Wus were not able to lodge a proper defence as the tax office had already made a submission to the court which was then put out into the public.

News.com.au has contacted the family for comment via their solicitors.

Nature’s Care was founded by the Wu family and is stocked in Australia and overseas.

One of the family’s sons, Jack Wu, is a property developer who reportedly lives in a three-bedroom apartment overlooking the Harbour Bridge in the heart of Sydney.

The AFR reported that 34-year-old Mr Wu received a demand from the tax office to repay them $116 million last December.

He had just three weeks to cough up the cash, according to the publication.

Mr Wu’s brother and parents received similar letters.

The family applied to have the Federal Court case suppressed to protect their personal details and their reputation.

The tax office submitted 4510 pages as evidence but Federal Court Judge Thawley ruled to suppress its contents in the interests of fairness in a judgment from last week.

In that hearing, it was also noted that one of the allegations regarding the Wu family’s links to the British Virgin Islands, a well-known tax haven, was already in the public domain.

The AFR previously reported that the sale of a large share of Nature’s Care was allegedly sent to a company the family had registered in the British Virgin Islands.

Tax investigators were unable to determine who was the director or owner of this company.

The authorities said it was possible all four family members had equal shares, or that one person wholly owned the business.

Either way, the ATO alleges this would render the family $207 million behind in their tax obligations.

In the same case, the court heard that the Wu family claimed they were “concerned for their safety” after their wealth had been aired in a public domain.

Their lawyer said that a stranger had approached Jack Wu’s home and also that two cars were parked outside his apartment for “a prolonged period”.

Jack Wu is a 34-year-old property developer who lives in this apartment, and was issued with a notice to pay back $116 million in tax. He is fighting the claims.

When it rains it pours, and this seems true for the Wu family.

The Wu family are also involved in another messy case against the two investment funds that bought into their business in 2018.

The private equity funds. which are reportedly controlled by the Chinese Communist Party, JIC Investments and Tamar Alliance Fund, bought a 75 per cent stake in Nature’s Care.

They soon became embroiled in a court case with the Wus.

Nature’s Care had defaulted on a loan, causing the Wu family to seek “to regain control” of their company by acquiring the debt.

The NSW Supreme Court judge noted this came as a “nasty surprise” for the two investment funds, who subsequently commenced legal proceedings, which they have since lost.

Last week, a holding company of Nature’s Care plunged into receivership over this loan default.

“The appointment follows an unresolved default under Nature’s Care Group’s senior banking facilities in August 2023,” the receivers, BDO Advisory, said to news.com.au in a statement.

“Unfortunately, this left the secured lenders with no choice but to enforce their security.”

The receivers noted they had only been appointed to a holding company of Nature’s Care and that it not impacting the other companies in the group which operate the business.

Nature’s Care has a manufacturing facility in Belrose, Sydney, with 200 workers.

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