Tuesday, August 8, 2017

Bankruptcy Bundaberg, So what is the Deal with Debts?

What Debts are erased if I go Bankrupt?
The basic answer is that when it involves Bankruptcy most debts are wiped, and I have added a compendium below for you to look at.

But, put simply some of the exceptions are Centrelink Debts, Child Support, Court fines (like speeding fines) and any debts arising from uninsured Motor-vehicle claims and educational debts which include HECS or FEE-HELP. These debts are not removed when you file for bankruptcy.

What about Secured Debts?
A secured debt is a vehicle loan or a home loan; it is a debt that has some real security connected to it. So for example if you buy a new car for $40,000 dollars the security for that car is the actual car itself.

So, can my secured debts be wiped out if I file for bankruptcy?
Yes. If you have a car loan for $40,000 you can have that debt wiped out if you simply return the car. So the lesson is that you cannot have your cake and eat it too (so to speak), so yes all of your secured debts might be wiped but the asset has to be sold or returned. This is just one element that, when it comes to Bankruptcy, it is vital to get professional advice - like that readily available at Bankruptcy Experts Bundaberg.

What about my Tax Debts with the ATO can they be eliminated If I go bankrupt?
Yes they can, both business and personal debts owing to the ATO can be wiped out with bankruptcy. If you have a business with any sort of debts receive some advice because it is not always so straightforward. Feel free to call us here at Bankruptcy Experts Bundaberg if you have any type of questions on 1300 795 575. Or feel free to check out our website: www.bankruptcyexpertsBundaberg.com.au

What about my business or Company debts?

Sometimes when it concerns Bankruptcy we can assist you with your business debts, call us concerning this first. Remember bankruptcy applies to an individual not companies, trusts or businesses. Normally you may need to liquidate a company to deal with the debt this way. When it comes to Bankruptcy, it can be a complicated area, so remember there are implications for a business owner such as insolvent trading. At Bankruptcy Experts Bundaberg we specialise in business and personal debts so give us a call here at Bankruptcy Experts Bundaberg if you have any questions about Bankruptcy on 1300 795 575. Or feel free to explore our website: www.bankruptcyexpertsBundaberg.com.au

Monday, May 22, 2017

Bankruptcy, Will I lose my Superannuation?



Bankruptcy in Australia can be involved and confusing. A question we commonly get asked here at Bankruptcy Experts Bundaberg is 'what happens to my super if I declare Bankruptcy'? The answer for most is straightforward, if your super is probably in a regulated fund or industry fund like Sunsuper or Host Plus then nothing at all happens; your super is 100 % safe when it comes to Bankruptcy.



What if I have a Self Managed Super Fund?

This is a growing concern, look into the evolving number of members of Self-Managed Super Funds ("SMSFs") in recent years; the ATO tells us it has expanded Australia-wide from 758,589 in 2009 to 1,011,689 in 2014. So what happens to these Superfunds when it comes down to Bankruptcy?

Remember Bankruptcy Experts Bundaberg is not indicating this post is the entire story, if you have any questions feel free to consult with us on 1300 795 575. Whether or not you call us or someone else it does not matter, just please don't walk into bankruptcy blind when it comes to your SMSF actually we encourage you find both legal and financial advice before proceeding with any of the actions suggested in this article.

What is a Disqualified Person?

First and foremost, if you are considering Bankruptcy, you can not be a part of a SMSF. Why? Because if you are being confronted by bankruptcy, you will be categorized as a 'disqualified person'. And a disqualified person cannot operate as an Individual Trustee. This poses a problem because usually most of the SMSFs are just 2 people, which means the two of these members have to also be the individual trustees. The job of trustee presents a lot of legal rules, and if you are in this position I would highly recommend you to become familiar with them all-- including the fact that you can not 'know or suspect' that one of you are bankrupt. So you can notice how an individual bankruptcy can be very damaging to a SMSF and as you can assume the process of Bankruptcy for a SMSF is rather convoluted.

How long do I have so as to restructure my SMSF Fund once I'm bankrupt?

So what takes place if one of the members of an SMSF does enter Bankruptcy?
For starters, the SMSF will have to be restructured. This means that you will want to consider your whole structure and make sure it is meeting the basic conditions, including having a new trustee that is not dealing with issues with Bankruptcy. The Australian Tax office will offer you a 6 month 'grace period' to get this done before you face penalties. And bear in mind, sometimes the most effective plan would be to simply roll the fund into an industry or corporate fund.

Beyond these large scale reorganizing issues, there is a lot of paperwork to deal with too, and you need to be continuously keeping the ATO informed of what is happening. This suggests you will need to let them know that you have a bankruptcy concern with your current trustee, that they are being removed as soon as possible know who the new trustee/director is. The Bankrupt will also need to inform the ATO using the form NAT 3036 (Found on the ATO website) and they need to also notify ASIC of their resignation.

Over that 6 month period you will need to remove the Bankrupt from the SMSF-- including their property and assets. Remember if you are uncertain call Bankruptcy Experts Bundaberg for some free advice on 1300 795 575.

What if I have a single member fund?

If you are a single member fund, then you will need to appoint a new director, and it will then end up being their obligation to oversee the sale and relocation of assets into a managed fund. If there are two or more members, than the bankrupt member will need to resign and the other member will clear away the property and halve the proceeds. They would then need to decide if they would like to remain as a single member SMSF, or if they intend to roll everything into a managed fund. If both members are entering bankruptcy, then they would definitely need to sell all assets right away and move the liquid assets to the managed fund.

From that you can see how when it comes to Bankruptcy, even when one single member is facing issues, it can affect the very existence of an SMSF. If you are at the moment facing this problem yourself, or with a partner in a SMSF, please seek financial advice to make certain you are fulfilling the ATO requirements.

A simple solution ...


As I proposed earlier, a simple solution to your SMSF issue is to put your super back into a normal regulated managed fund before bankruptcy and save yourself all the problems outlined above. Bankruptcy is never easy, but receiving proper advice is the best first step. If you want to discuss your possibilities further, contact us at Bankruptcy Experts Bundaberg or visit our website: www.bankruptcyexpertsBundaberg.com.au or just give us a call on 1300 795 575.

Thursday, January 19, 2017

Bankruptcy in Bundaberg - Will I lose my house if I go bankrupt?


Bankruptcy Bundaberg is a complex process, but I know from meeting with thousands facing the chance of bankruptcy over the years, that almost nothing troubles people more than the notion of losing the family home. Almost every person is emotionally connected to their home - it's where the kids have grown up, it's where you appreciate life on a day to day base.



Will you lose your home if you go bankrupt? The answer is a resounding maybe. (not very helpful, I know) People typically assume it's an inevitable consequence and a part of Bankruptcy, and therefore push themselves to the brink of insanity to not lose the family home. But when it comes to the whole process of Bankruptcy, a key benefit of Debt Agreements and Personal Insolvency Agreements is you can keep your house. The reason is simple: you've agreed to pay back the debt you are in.

So how is it possible to keep my Bundaberg house, you ask? It's easier if I explain the basic principle behind the Bankruptcy process as administered by the trustee, then you'll have a clearer picture.

The purpose of the bankruptcy trustee is to firstly comply with the regulation of the bankruptcy act 1966 (it's a very dull read about 600 pages if you are wondering).

Within that regulatory framework, the trustee is to help recover monies owed to your creditors, that is executed in a bunch of assorted ways but it mainly comes down to income and assets. The trustees role is to collect payments over your income threshold. The further role is to sell any assets that can contribute to paying back your debts.

What this seems is that yes the trustee will sell your house right? Not always. The only reason the trustee will sell any asset including your house is to get money to repay your debts. If there is no equity in your house then it's pointless to sell your home. This is happening much more since the GFC as house prices in many areas have been heading south so what you paid 4 years ago may not automatically reflect the price today.

A quick word of advice here if you have a house in Bundaberg and are looking at Bankruptcy: get a skilled professional to help you through this process, there are a lot of variables in these scenarios that have to be considered.

You might wonder, why would the bank want bankrupt clients? wouldn't they hope to sell your house and not take the risk? The bank that has nicely lent you the money for your house is making good money every month in interest out of you, month in month out, provided that you keep up to date with your payments then the bank desires you in there at all costs. Ultimately however it's not the bank's call if the trustee determines that there is plenty of equity in your house the trustee will force you and the bank to sell the house.

When you file for bankruptcy you are asked to write down the value of your house and the amount you owe on the house. A tip if you are attempting to work out the value of your house: use a registered valuer as this will provide you peace of mind, don't use your neighbours' gut feel suggestions or a real estate agents advice to arrive at this figure. When you get a valuer out to your home, ensure that you tell the valuer to value the property for a quick sale, ensure you mow the lawn and don't leave the kitchen in a mess also.

Valuers used to provide two valuations: one for a quick sale and one for a well marketed non time sensitive sale. Nowadays that's not the case, but if you meet them and tell them you need to sell your home in the next 30 days you may sway the result. The idea is that you want a sensible sell now figure.

There are two reasons this valuation technique is critical to you: one you will definitely have peace of mind ascertaining the market value of your house, then afterwards you can easily build your equity position. Secondly, your home may be really worth a lot more than you thought. Get some tips before doing this. The amount of times I've met clients that have sold their family home of 20 years only to find out I could of helped them keep it; unfortunately this happens all too often

When it comes to Bankruptcy and houses, another major consideration is ownership, in most cases houses are bought in joint names. Simply put a couple may be a house 50/50 using both incomes to make the payments. If one party declares bankruptcy and the other party does not, the equity is only factored on the 50 % of the property.

When it relates to Bankruptcy, this is just one of likely hundreds of scenarios that are possible when it comes down to the family home. Bear in mind the non-bankrupt party can buy the bankrupt's portion of the home in bankruptcy also. I should repeat this but get some information on this area of Bankruptcy because it is very tricky and each and every case is different.

If you want to learn more about what to do, where to turn and what questions to ask about Bankruptcy, then feel free to speak to Bankruptcy Experts Bundaberg on 1300 795 575, or visit our website: www.bankruptcyexpertsBundaberg.com.au.

Thursday, November 17, 2016

Bankruptcy in Bundaberg - Who do I speak to?


Should I speak to my accountant about Bankruptcy?
The answer seems clear doesn't it: if anybody knows your financial situation well in Bundaberg, It's going to be your accountant. However, the short answer is a resounding No! It's not that your accountant will not have your best interests in mind when it comes to Bankruptcy, it's that his skills lie in helping you save you money at tax time, minimizing your tax liability and lodging your BAS.

Most accounting degrees will put in hardly any to no time on insolvency, it's generally performed as a post graduate speciality course for those who intend to work in the field. Unless your accountant is an insolvency specialist, he would not know that a lot about the effects of Bankruptcy, I can assure you insolvency specialists know much about tax returns or BAS in. If you do happen to find an insolvency accounting firm in Bundaberg, they often tend to be large firms with very nice offices who charge accordingly.

Should I speak to my Solicitor about Bankruptcy?
No! You can talk with your solicitor in Bundaberg but more than likely it won't do you much good. Solicitors are definitely good at carrying out things lawyers do, like helping you do your Will and buying your house and keeping you out of court if you're lucky. When it concerns Bankruptcy, the specialists in Bundaberg tend to have either a legal or accounting qualifications, and the reason for that is simply that you can't start in the post graduate study to become a qualified insolvency practitioner unless you have a law or accounting degree.
Just as there are a couple of insolvency accounting firms, there are very few insolvency legal practices in Australia, and yes if you choose one you will pay a hefty price for their expertise.

Should I talk to a financial counsellor about Bankruptcy?
Yes! There are a lot of financial counselling services to guide you with this, they have no hidden agendas and they're a terrific option for letting you analyze your situation when it comes to Bankruptcy. If you find yourself stressing constantly, not sleeping, not eating or over-eating and thinking of money pressures at all times, then get some help.

There are also charitable organizations around Bundaberg like Lifeline that offer a remarkable service. They will be a sounding board if you just need a person to discuss with you what your alternatives are. Don't let your financial problem destroy your life - ultimately it's just money.


If you need to learn more about what to do, where to turn and what problems to ask about Bankruptcy, then feel free to speak to Bankruptcy Experts Bundaberg on 1300 795 575, or visit our website: www.bankruptcyexpertsBundaberg.com.au.

Monday, August 8, 2016

Bankruptcy in Bundaberg - Will I lose my business if I go bankrupt?


When people in Bundaberg come to me planning to talk about Bankruptcy, they are typically full of questions. The internet is full of information, but far too much of it is confusing or contradicts itself, so I make it my mission to try and make it clearer. One of the most typical priorities is 'Will I lose my business if I declare bankruptcy?' The concise answer is no. If you are a manager of a business any shape or size you can keep your business if you want to. In Bundaberg, businesses that end up being insolvent have a few options for example, liquidation, voluntary administration and so on. It's people who go bankrupt not businesses.

Bankruptcy is a complicated area so get some qualified advice on this one if you have a business. Generally speaking, the financial obligations in a business and personal debts go hand in hand when a business owner goes bankrupt. There are some important implications for directors of companies when it pertains to Bankruptcy in Bundaberg: A bankrupt can not be a director of a company, so if you have a pty ltd company you will need to resign as a director once you're bankrupt.

A restriction that applies when you are bankrupt as a business owner is that you can be in your very own business as a sole trader only. Certainly there are things you must disclose as an aspect of that but effectively you can still run your company. For some business owners, bankruptcy impacts their ability to run the business because of the licensing issues. For instance, if you run a building company, your license will be suspended once you're bankrupt and therefore you can not trade without that license, so make sure you are asking the ideal questions when it comes to licenses and Bankruptcy in Bundaberg.

However if your business is not impacted directly by such issues, then you'll need to restructure the way you run your business. There are considerations when and if you go bankrupt as a business owner: you can not acquire heaps of debt in your business, then go bankrupt and then open the doors the next day like practically nothing had happened. There are laws in place to stop what is called phoenix companies popping up out of the ashes of an old business.

Having said that, it's just a point of talking to the best people about Bankruptcy. In this circumstance you may believe you need a liquidator for your business, and you could be right, but keep that in mind every liquidator is unique and have their own motives. Liquidators make money from your liquidation - heaps of money - so exactly what advice do you think you will get?

When it comes to Bankruptcy, I believe that giving generic advice in this area is potentially perilous as it can have very significant implications for directors and business owners. This is due to the fact that it is just one of those cases where what the right advice for one business owner is the wrong advice for the other. There are some principles however, that you may benefit from. There is no limitation to the size of the business you run when you are bankrupt. You can employ staff. You can continue to deal with your vendors under certain conditions, the main one being you will need to meet the payment terms agreed upon.


So when it concerns Bankruptcy, don't get overly worried about what you can and can't do as a business owner, just get the best advice ... If you need to learn more about what to do, where to turn and what questions to ask about Bankruptcy, then feel free to speak with Bankruptcy Experts Bundaberg on 1300 795 575, or visit our website: .bankruptcyexpertsBundaberg.com.au.

Wednesday, July 6, 2016

Bankruptcy in Bundaberg - Changes that can help Small Business and Entrepreneurs


Do you understand how much Bankruptcy Bundaberg is changing? The Australian Government at the end of 2015 set forth some radical changes to the Bankruptcy Laws in Australia. Among 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 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 improvements to the issue of Bankruptcy will take 18 months to implement. Mr Carnegie, went on to say in the Financial Review that guarding family assets was essential because "banks just terrorise small business and the mental health consequences to society are enormous".

The problem is Australia's bankruptcy laws put off investors from supporting start-ups, and as a result 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 debate around this Bankruptcy issue in Bundaberg that some come up with is that this revision will only strengthen fraudulent behavior opening pandora's box in a manner of speaking for the unscrupulous to exploitation of the bankruptcy system. We have looked at the minimum, but on the other side of the matter, The government is not suggesting to change the maximum term of 8 years if it deems a bankrupt has acted in an unethical or fraudulent way, and there are no recommendations to change the outcomes of misrepresenting yourself or financial position when filing for bankruptcy in Australia.

As an insolvency professional in Bundaberg, I have a fair share of experience when it comes to Bankruptcy. And having dealt with countless bankruptcy cases in Bundaberg I have never struck someone abusing the system or acting in a careless way as to exploit the insolvency laws in Australia. When it comes to Bankruptcy, each week I help a small business owner or entrepreneur go through the very tough task of bankruptcy, not once have I really felt they are happy about it. The ordinary small business owner or entrepreneur in Bundaberg does not start out taking enormous financial risks with the intention to fail. The media prefers citing the apparent wrongdoing that will be rampant if these changes occur, what a joke!


A Win for Small Business

These suggested changes will be good for often the best and brightest in Bundaberg not get tossed 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, employers keeping this country going.

There certainly is a fine line with what exactly the government is trying to do here, since they are attempting to balance helping individuals who have made decisions out of their control, and discouraging people from making oversights that land them in trouble and as a result an issue of Bankruptcy. However you also don't want to wipe out 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 enterprise 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 cut down because directors are worried they'll be personally liable in an insolvency arrangement if the new venture doesn't work out.

The government's suggested 'safe haven' changes for directors of companies will enable Australia to more fully explore and innovate, which will make big changes for Bankruptcy. I cannot imagine, that these revisions will be detrimental to Australia's economy, indeed 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 Bundaberg not a day goes by where I don't find out the tragic experiences of relationship failures, thoughts of suicide and the list continues.


Bankruptcy helps save lives, and it could save yours. If you want some help with your debts in Bundaberg or are just considering Bankruptcy, feel free to call us here at Bankruptcy Experts Bundaberg on 1300 795 575, or visit our website:bankruptcyexpertsbundaberg.com.au

Monday, July 4, 2016

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


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

Involuntary bankruptcy arises when someone you owe money to applies to the court to declare you bankrupt. Commonly when you get one of those notices, you have normally 21 days to pay all the debt. If you don't, then the creditor returns to the court and requests the court to provide a sequestration order that declares you bankrupt. A trustee is appointed, and then you have 14 days to get the documentation in and afterwards you are bankrupt.

You can challenge a bankruptcy notice by going to court right after the 21 days have expired and put your case forward, to avoid it going to the next level. Other than the way you became bankrupt there is in reality no distinction between Involuntary Bankruptcy and or Voluntary Bankruptcy - once you are declared bankrupt, they're overseen to in the exact same way.

However, when it concerns Bankruptcy for this, the stress and anxiety, torment and fear that accompanies this method is incredible. If you think you are prone to be made bankrupt by someone, get some suggestions 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 a person bankrupt you. Once you are bankrupt, it's typically too late.

Voluntary Bankruptcy

However, when it comes to Bankruptcy, sometimes there are moments that it is the most effective option. So you may need to ask yourself, 'when should I consider voluntary Bankruptcy?'.

This question is not the very same for everyone of course, but usually I find that one way you could work it out is to figure out 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 level she was paying off her account, and it was 35 years! Imagine 35 years for one credit card bill.

Credit rating damage can really help you think this through. If you move house and overlook to pay your $30 phone bill for 6 months more, it's very likely the phone company will default your credit file. That default will sit 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 affect how you need to approach Bankruptcy.

In many ways, the ease with which companies/credit providers can default your credit file is unjust. 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 aspect 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 contrast is that with a DA or PIA you pay back the money and nevertheless have it on your file for 7 years.

Bankruptcy

I have talked about the word a few times now, but when it comes down to it, Bankruptcy is the biggest part, and the part more people are afraid of when they come to me to talk about their financial situation and Bankruptcy. The other side of crime and punishment equation is bankruptcy, and in this country the arrangements 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. Nowadays I suppose the government feels 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 all 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 actually insured.

There is much more that can be said about this and Bankruptcy in general but the objective of this blog was to help you decide between a few possible options. When getting some advice, remember that there are always alternatives when it involves Bankruptcy in Bundaberg, so do some homework, and Good luck!


If you want to learn more about just what to do, where to turn and what questions to ask about Bankruptcy, then don't hesitate to check with Bankruptcy Experts Bundaberg on 1300 795 575, or visit our website: bankruptcyexpertsBundaberg.com.au.