Bankruptcy in Alice Springs - Changes that help Small Business and Entrepreneurs

Do you have an idea of just how much Bankruptcy AliceSprings is changing? The Australian Government at the end of 2015 set forth some progressive 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. At this time, there is a minimum amount of time that you must remain bankrupt, having said that, this 3 year period may very well be reduced to just 12 months. So if you are inquiring about Bankruptcy, this news may be quite important to you.

Mark Carnegie in the Financial Review on the 7th December 2015 suggested 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 changes 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 very important because "banks just terrorise small business and the mental health consequences to society are enormous".

The problem is Australia's bankruptcy laws prevented 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 controversy about this Bankruptcy issue in Alice Springs that some come up with is that this shift will only push fraudulent behavior opening pandora's box in a manner of speaking for the unscrupulous to misuse of the bankruptcy system. We have looked at the minimum, but on the other side of the issue, The government is not proposing 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 proposals to change the outcomes of misrepresenting yourself or financial position when filing for bankruptcy in Australia.

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

A Win for Small Business

These recommended changes will be good for often the best and brightest in Alice Springs not get tossed 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, companies keeping this country going.

There really is a fine line with exactly what the government is trying to do here, because they are aiming to balance helping people who have made decisions out of their control, and preventing people from making errors that land them in trouble and as a result an issue of Bankruptcy. However you also don't want to get rid of the experience and knowledge that business owners have. You absolutely don't want to smash people simply because they have had an honest failure in a large or small start-up enterprise that has not panned out.

At the big end of town large well-known 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 lowered because directors are worried they'll be personally responsible in an insolvency arrangement if the new venture doesn't work out.

The government's suggested 'safe haven' modifications for directors of companies will allow Australia to more fully explore and innovate, which will make big updates 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 sector because the emotional cost of bankruptcy is extensive. When it comes to Bankruptcy in Alice Springs not a day goes by where I don't find out the tragic stories of relationship failures, thoughts of suicide and the list goes on.

Bankruptcy helps save lives, and it could save yours. If you need some assistance with your debts in Alice Springs or are just thinking about Bankruptcy, don't hesitate to phone us here at Bankruptcy Experts Alice Springs on 1300 795 575, or visit our website: bankruptcyexpertsalicesprings.com.au

Bankruptcy in Alice Springs - does it matter if it is voluntary?

When it comes to Bankruptcy in Alice Springs, usually people aren't aware that there can be both voluntary, and involuntary bankruptcy - both have unique methods and policies.

Involuntary bankruptcy takes place when a person you owe money to involves the court to declare you bankrupt. Usually when you get one of these notices, you have normally 21 days to pay all the debt. If you don't, then the creditor goes back to the court and asks the court to issue a sequestration order that declares you bankrupt. A trustee is appointed, and then you have 14 days to get the documents in and then you are bankrupt

You can object to a bankruptcy notice by going to court right 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 distinction between Involuntary Bankruptcy and or Voluntary Bankruptcy - once you are declared bankrupt, they're administered to in the exact same way.

However, when it concerns Bankruptcy for this, the stress, torment and fear that accompanies this method is incredible. If you think you are probable 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 somebody bankrupt you. Once you are bankrupt, it's usually far too late.

Voluntary Bankruptcy

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

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

Once, I had an 80 year old pensioner, who came 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 forget 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 truly damaged for that period of time - and all of this will impact how you need to approach Bankruptcy.

In many ways, the ease with which companies/credit providers can default your credit file is unfair. The punishment doesn't seem to equate to the crime in my book. So if you already 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 aspect 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 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 element more 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 good.

I don't claim to know why that is but a couple of hundred years ago debtors went to prison. Nowadays I suppose the government finds that 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 with the exception of 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 a lot 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, keep in mind that there are always possibilities when it involves Bankruptcy in Alice Springs, so do some legwork, 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 feel free to reach out to Bankruptcy Experts Alice Springs on 1300 795 575, or visit our website: bankruptcyexpertsAlice Springs.com.au.