Bankruptcy in Bunbury - Changes to help Small Business and Entrepreneurs

Do you know how much Bankruptcy Bunbury is changing? The Australian Government in late 2015 recommended some innate changes to the Bankruptcy Laws in Australia. One of the most significant of these is the length of time that a person is bankrupt for. Right now, there is a minimum amount of time that you must continue to be bankrupt, however, this 3 year period may very well be reduced down to just 12 months. So if you are inquiring about Bankruptcy, this news may be somewhat important to you.

Mark Carnegie in the Financial Review on the 7th December 2015 recommended that "the proposed changes to ease the burden of bankruptcy laws didn't go far enough and the government should adopt US-style laws to protect the family home".

These adjustments to the issue of Bankruptcy will take 18 months to implement. Mr Carnegie, went on to say in the Financial Review that shielding family assets was important because "banks just terrorise small business and the mental health consequences to society are enormous".

The problem is Australia's bankruptcy laws discouraged investors from supporting start-ups, and therefore mentoring had been "driven out of the system".

"They naturally find it very intimidating themselves personally and with their assets at risk in a risky early-stage deal, but with their own money in the deal and a lightened-up provision I think we 'd probably see more willingness. It could be more important than the money.".

Fraudulent Behavior

The argument surrounding this Bankruptcy issue in Bunbury that some come up with is that this shift will only invite fraudulent behavior opening pandora's box so to speak for the unscrupulous to exploitation of the bankruptcy system. We have looked at the minimum, but on the other side of the problem, The government is not proposing to change the maximum term of 8 years if it deems a bankrupt has operated in an unethical or fraudulent way, and there are no recommendations to change the consequences of misrepresenting yourself or financial situation when filing for bankruptcy in Australia.

As an insolvency professional in Bunbury, I have a reasonable share of knowledge when it concerns Bankruptcy. And having dealt with countless bankruptcy cases in Bunbury I have never caught someone abusing the system or acting in an immoral way as to exploit the insolvency laws in Australia. When it comes to Bankruptcy, each week I help a small business owner or entrepreneur suffer through the very complex task of bankruptcy, not once have I thought they are happy about it. The average small business owner or entrepreneur in Bunbury does not start out taking enormous financial risks with the intention to fail. The media prefers citing the apparent misuse that will be rampant if these changes occur, what a joke!

A Win for Small Business

These proposed changes will be good for often the most effective and brightest in Bunbury not get kicked out of the game financially for financial decisions often out of their control. Most small business owners I help with Bankruptcy, are hardworking, tax paying, companies keeping this country going.

Now there is a fine line with exactly what the government is trying to do here, since they are trying to balance helping individuals who have made decisions out of their control, and preventing people from making missteps that land them in trouble and as a result an issue of Bankruptcy. However you likewise don't want to eliminate the experience and knowledge that business owners have. You undoubtedly don't want to smash people simply because they have had a genuine failure in a large or small start-up venture that has not succeeded.

At the big end of town large established companies have long been criticised for their failure to innovate - lets face it they would be more likely to do so if the risks of bankruptcy were decreased because directors are distressed they'll be personally accountable in an insolvency arrangement if the new project doesn't work out.

The government's suggested 'safe haven' modifications for directors of companies will enable Australia to more fully explore and innovate, which will make big changes for Bankruptcy. I can not imagine, that these variations will be damaging to Australia's economy, in reality these bankruptcy laws will save the tax payer in all areas of health - Especially in the mental health field because the emotional cost of bankruptcy is enormous. When it comes to Bankruptcy in Bunbury not a day passes where I don't hear the tragic experiences of relationship failures, thoughts of suicide and the list continues.

Bankruptcy helps save lives, and it could save yours. If you need some help with your debts in Bunbury or are just considering Bankruptcy, don't hesitate to give us a call here at Bankruptcy Experts Bunbury on 1300 795 575, or visit our website:bankruptcyexpertsbunbury.com.au

Bankruptcy in Bunbury - does it matter if it is voluntary?

When it comes to Bankruptcy Bunbury, normally people aren't aware that there may be both voluntary, and involuntary bankruptcy - both have distinct methods and rules.

Involuntary bankruptcy happens when a person you owe money to involves the court to declare you bankrupt. Normally when you get one of these kinds of notices, you have actually 21 days to pay all the debt. If you do not, then the creditor returns to the court and asks the court to issue a sequestration order that declares you bankrupt. A trustee is assigned, and then you have 14 days to get the documents in and after that you are bankrupt.

You can challenge a bankruptcy notice by going to court after the 21 days have expired and put your case forward, to prevent it going to the next level. Apart from the way you became bankrupt there is in fact no difference between Involuntary Bankruptcy and or Voluntary Bankruptcy - once you are simply declared bankrupt, they're administered to in the very same way.

However, when it comes to Bankruptcy for this, the stress, torment and fear that accompanies this method is incredible. If you think you are more than likely to be made bankrupt by someone, get some help and act on that advice. Generally I've found it's always more effective to know what you can and can't do before you have someone bankrupt you. Once you are bankrupt, it's normally too late.

Voluntary Bankruptcy

Alternatively, when it comes to Bankruptcy, sometimes there are times that it is the best option. So you may want to ask yourself, 'when should I consider voluntary Bankruptcy?'.

This question is not the very same for everybody of course, but basically I find that one way you could work it out is to figure out just how long it will take you to pay each of your debts - if its longer than 3 years (the period you are declared bankrupt), then this may help you make that decision, and help you to understand Bankruptcy.

Once, I had an 80 year old pensioner, who spoke to me once regarding * Bankrupcty tell me that her credit card statement calculated how long her debt would take to pay at the rate she was paying off her account, and it was 35 years! Imagine 35 years for one credit card bill.

Credit rating damage can help you think this through. If you move house and fail to remember to pay your $30 phone bill for 6 months more, it's very likely the telephone company will default your credit file. That default will remain on your file for 5 years, so for $30 you can have your credit file seriously damaged for that period of time - and all of this will impact how you have to approach Bankruptcy.

In many ways, the ease with which companies/credit providers can default your credit file is unethical. The punishment doesn't seem to amount to the crime in my book. So if you actually have defaults on your credit report for 5 years, bear in mind that bankruptcy is on your credit file for a total 7 years then its rubbed out completely.

So if your credit rating is a big element in trying to decide whether to participate in a Debt Agreement or Personal Insolvency Agreement or Bankruptcy remember they will all sit on your credit file for a total of 7 years. The biggest variation is that with a DA or PIA you repay the money and still have it on your file for 7 years.

Bankruptcy

I have stated the word a few times now, but when it comes down to it, Bankruptcy is the biggest part, and the part most people are afraid of when they come to me to go over their financial situation and Bankruptcy. The other side of crime and punishment equation is bankruptcy, and in this country the provisions are very generous: you can go bankrupt owing millions of dollars and after 3 years it's all over with no strings attached. As compared to countries like the United States, our bankruptcy laws are very generous.

I don't pretend to know why that is but a few hundred years ago debtors went to prison. These days I suppose the government assumes the sooner it can get you back on your feet working and paying tax, the better. It makes more sense than locking you up which in turn costs the taxpayer anyway.

Bankruptcy wipes every one of your debts including ATO debts except for a few things:

·         Centrelink Debts, Court Fines like parking and speeding fines.

·         HECS or Fee Help loans.

·         Money to take care of a car accident if the car was not insured.

There is much more that can be said about this and Bankruptcy in general but the purpose of this blog was to help you decide between a few possible options. When getting some advice, don't forget that there are always options when it concerns Bankruptcy in Bunbury, so do some research, and Good luck!

If you wish to find out more about just what to do, where to turn and what questions to ask about Bankruptcy, then don't hesitate to consult with Bankruptcy Experts Bunbury on 1300 795 575, or visit our website:bankruptcyexpertsBunbury.com.au.