Bankruptcy in Tamworth - Changes to aid Small Business and Entrepreneurs

Do you have an idea of just how much BankruptcyTamworth is changing? The Australian Government in late 2015 proposed some foundational changes to the Bankruptcy Laws in Australia. The most significant of these is the length of time that a person is bankrupt for. At this time, there is a minimum amount of time that you must remain bankrupt, however, this 3 year period may in fact be reduced to just 12 months. So if you are inquiring about Bankruptcy, this news may be fairly 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 guarding family assets was necessary 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 Tamworth that some come up with is that this shift will only strengthen fraudulent behavior opening pandora's box in a manner of speaking for the unscrupulous to misuse of the bankruptcy system. We have looked into the minimum, but on the other side of the issue, The government is not recommending to change the maximum term of 8 years if it deems a bankrupt has performed in an unethical or fraudulent way, and there are no propositions to change the repercussions of misrepresenting yourself or financial position when filing for bankruptcy in Australia.

As an insolvency professional in Tamworth, I have a fair share of experience when it concerns Bankruptcy. And having dealt with thousands of bankruptcy cases in Tamworth I have never struck someone abusing the system or acting in an immoral way as to exploit the bankruptcy laws in Australia. When it comes to Bankruptcy, every week I help a small business owner or entrepreneur suffer through the very challenging task of bankruptcy, not once have I believed they are happy about it. The standard small business owner or entrepreneur in Tamworth does not start out taking enormous financial risks with the intent to fail. The media really loves citing the apparent abuse 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 very best and brightest in Tamworth not get kicked out of the game financially for financial decisions often outside of their control. Most small business owners I help with Bankruptcy, are hardworking, tax paying, employers keeping this country going.

Now there is a fine line with the things the government is trying to do here, since they are aiming to balance helping individuals who have made decisions out of their control, and preventing people from making errors that land them in trouble and therefore an issue of Bankruptcy. However you likewise don't want to get rid of the experience and knowledge that business owners have. You absolutely don't want to shatter people simply because they have had a sincere failure in a large or small start-up venture that has not worked out.

At the major end of town large well 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 lessened because directors are distressed they'll be personally accountable in an insolvency arrangement if the new endeavor 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 cannot imagine, that these differences will be damaging to Australia's economy, in fact 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 substantial. When it comes to Bankruptcy in Tamworth not a day goes by where I don't find out the tragic stories of relationship failures, thoughts of suicide and the list continues.

Bankruptcy helps save lives, and it could save yours. If you need some assistance with your debts in Tamworth or are just thinking about Bankruptcy, feel free to contact us here at Bankruptcy Experts Tamworth on 1300 795 575, or visit our website: bankruptcyexpertstamworth.com.au

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

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

Involuntary bankruptcy happens when somebody you owe money to applies to the court to declare you bankrupt. Normally when you get one of those notices, you have actually 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 assigned, and then you have 14 days to get the documentation in and after that you are bankrupt.

You can object to a bankruptcy notice by going to court shortly after the 21 days have expired and put your case forward, to stop it going to the next level. Other than the way you became bankrupt there is in reality no difference between Involuntary Bankruptcy and or Voluntary Bankruptcy - once you are simply declared bankrupt, they're overseen to in the 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 likely to be made bankrupt by someone, get some advice 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 generally too late.

Voluntary Bankruptcy

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

This question is not the same for every person of course, but commonly I find that one way you could work it out is to figure out how long it will take you to pay all of your debts - if its longer than 3 years (the period you are declared bankrupt), then this may assist 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 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 phone service will default your credit file. That default will remain on your file for 5 years, so for $30 you can have your credit file very 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 improper. The punishment doesn't seem to equate to the crime in my book. So if you actually have defaults on your credit report for 5 years, remember that bankruptcy is on your credit file for a total 7 years then its erased completely.

So if your credit rating is a big issue in trying to decide whether to enter into 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 review their financial situation and Bankruptcy. The other side of crime and punishment equation is bankruptcy, and in this specific 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. Compared to countries like the United States, our bankruptcy laws are really reasonable.

I don't claim to know why that is but a couple of hundred years ago debtors went to prison. These days I suppose the government believes 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 pay for a car accident if the car was not insured.

There is much more that can be said about doing this and Bankruptcy in general but the purpose of this blog was to help you decide between a few readily available options. When getting some advice, bear in mind that there are always options when it concerns Bankruptcy in Tamworth, so do some investigation, and Good luck!

If you want to find out more about just what to do, where to turn and what questions to ask about Bankruptcy, then feel free to speak with Bankruptcy Experts Tamworth on 1300 795 575, or visit our website: bankruptcyexpertsTamworth.com.au.