Tuesday, August 8, 2017

Bankruptcy Maitland, So what is the Deal with Debts?

Exactly what Debts are erased if I go Bankrupt?

The quick answer is that when it concerns Bankruptcy most debts are wiped, and I have also included 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 even any debts arising from uninsured Motor-vehicle claims and educational debts including HECS or FEE-HELP. These debts are not eliminated 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 genuine security attached to it. So as an 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 erased if I file for bankruptcy?
Yes. If you have a car loan for $40,000 you can have that debt cleared away 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 may be wiped but the asset will need to be sold or returned. This is just one part that, when it comes to Bankruptcy, it is vital to get professional help - like that provided at Bankruptcy Experts Maitland.

What about my Tax Debts with the ATO can they be removed 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 find some advice because it is not always so simple. Feel free to call us here over at Bankruptcy Experts Maitland if you have any questions on 1300 795 575. Or feel free to visit our website: www.bankruptcyexpertsMaitland.com.au

What about my business or Company debts?

Sometimes when it involves Bankruptcy we can really help you with your business debts, call us concerning this first. Remember bankruptcy applies to an individual not companies, trusts or businesses. Generally you may have to liquidate a company to deal with the debt that way. And 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 Maitland we specialise in business and personal debts so contact us here at Bankruptcy Experts Maitland if you have any questions regarding Bankruptcy on 1300 795 575. Or feel free to check out our website: www.bankruptcyexpertsMaitland.com.au

Monday, May 22, 2017

Bankruptcy, Will I lose my Superannuation?



Bankruptcy in Australia can be convoluted and perplexing. A question we usually get asked here over at Bankruptcy Experts Maitland is 'what happens to my super if I file for Bankruptcy'? The reply for most is straightforward, if your super is probably in a regulated fund or industry fund like Sunsuper or Host Plus then absolutely nothing happens; your super is 100 % safe when it comes down to Bankruptcy.


What if I have a Self Managed Super Fund?

This is a growing concern, think about the expanding 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 involves Bankruptcy?

Remember Bankruptcy Experts Maitland is not suggesting this article is the complete story, if you have any questions feel free to get in touch with us on 1300 795 575. Whether you call us or somebody else it does not matter, just please don't walk into bankruptcy blind when it comes to your SMSF actually we recommend you look for both legal and financial advice before proceeding with any of the actions indicated in this article.

What is a Disqualified Person?

First and foremost, if you are thinking about Bankruptcy, you can not be a part of a SMSF. Why? Because if you are coping with bankruptcy, you will be grouped as a 'disqualified person'. And a disqualified individual cannot operate as an Individual Trustee. This poses a problem due to the fact that usually most of the SMSFs are just 2 people, which means both of these members have to also be the individual trustees. The job of trustee causes a lot of legal rules, and if you are in this role I would highly urge you to get knowledgeable about them all-- for example the fact that you can not 'know or suspect' that one of you are bankrupt. So you can see how an individual bankruptcy can be very harmful 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 after I'm bankrupt?

So what transpires 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 have to consider your complete structure and make sure it is meeting the basic conditions, including things like having a new trustee that is not suffering from issues with Bankruptcy. The Australian Tax office will give you a 6 month 'grace period' to get this done before you face penalties. And consider, sometimes the most suitable 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 indicates you ought 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 must also notify ASIC of their resignation.

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

What if I use a single member fund?

If you are a single member fund, then you will have to appoint a new director, and it will then become their duty to oversee the sale and transfer 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 remove the property and halve the proceeds. They would then want to decide if they wish to remain as a single member SMSF, or if they want to roll it all into a managed fund. If both members are entering bankruptcy, then they would definitely need to sell all assets as soon as possible and transfer the liquid assets to the managed fund.

From this you can see how when it comes to Bankruptcy, even though one single member is facing issues, it can affect the very existence of an SMSF. If you are actually facing this trouble yourself, or with a partner in a SMSF, please seek financial advice to make sure you are satisfying the ATO requirements.

A simple solution ...


As I recommended earlier, a basic solution to your SMSF problem is to put your super back into a normal regulated managed fund prior to bankruptcy and save yourself all the problems outlined above. Bankruptcy is never easy, but getting proper advice is the best initial step. If you want to discuss your options further, give us a call at Bankruptcy Experts Maitland or visit our website: www.bankruptcyexpertsMaitland.com.au or just give us a call on 1300 795 575.

Thursday, January 19, 2017

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

Bankruptcy Maitland is a difficult to understand process, but I know from meeting with thousands facing the chance of bankruptcy over the years, that virtually nothing troubles people more than the idea of losing the family home or apartment. Almost everyone is sentimentally connected to their home - it's where the kids have grown up, it's where you take pleasure in life on a day to day basis.


Will you lose your house if you go bankrupt? The answer
 is a resounding maybe. (not very useful, I know) People typically presume it's an inevitable consequence and a part of Bankruptcy, and hence 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 strength 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 Maitland house, you ask? It's easier if I explain the basic theory behind the Bankruptcy process as administered by the trustee, then you'll have a clearer image.

The job of the bankruptcy trustee is to firstly agree to the regulation of the bankruptcy act 1966 (it's a very dry read about 600 pages if you are serious).

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

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

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

You might wonder, why would the bank want bankrupt customers? wouldn't they hope to sell your house and not take the risk? The bank that has kindly 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 repayments then the bank really wants you in there at all costs. Essentially however it's not the bank's call if the trustee decides that there is a lot 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 mark the value of your house and the portion you owe on the house. A tip if you are aiming to work out the value of your house: use a registered valuer as this will give you peace of mind, don't use your neighbours' gut feel advice or a real estate agents advice to arrive at this figure. When you get a valuer out to your house, ensure you tell the valuer to value the property for a quick sale, see to it 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 the house in the next 30 days you may control the result. The idea is that you want a real sell now figure.

There are two reasons this valuation system is critical to you: one you will certainly have peace of mind ascertaining the market value of your house, then afterwards you can easily set up your equity position. Second of all, your property may be worth so much more than you thought. Get some tips before doing this. The amount of times I've seen 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 concerns Bankruptcy and houses, another big consideration is ownership, often houses are acquired in joint names. To puts it simply a couple may be a house 50/50 using both incomes to make the payments. If one party declares bankruptcy and the other party doesn't, the equity is only factored on the 50 % of the property.

When it relates to Bankruptcy, this is just one of potentially numerous scenarios that are possible when it relates to the family home. Bear in mind the non-bankrupt party can buy the bankrupt's part of the home in bankruptcy also. I need to repeat this but get some advice on this area of Bankruptcy because it is very tricky and every case is different.


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 Maitland on 1300 795 575, or visit our website: www.bankruptcyexpertsMaitland.com.au.

Thursday, November 17, 2016

Bankruptcy in Maitland - Who exactly do I speak to?



Should I talk to my accountant about Bankruptcy?
The answer seems obvious doesn't it: if anybody knows your financial situation well in Maitland, It's going to be your accountant. However, the short answer is a definite No! It's not that your accountant may not have your best interests at heart when it comes to Bankruptcy, it's that his proficiency lie in helping you save you money at tax time, minimising your tax liability and lodging your BAS.

Most accounting degrees will spend hardly any to no time on bankruptcy, it's generally performed as a post graduate specialty program for those who intend to work in the field. Unless your accountant is an insolvency expert, he will 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 manage to find an insolvency accounting firm in Maitland, they often tend to be large firms with very nice offices who charge accordingly.

Should I consult my Solicitor about Bankruptcy?
No! You can speak to your solicitor in Maitland but more than likely it won't do you much good. Solicitors are definitely good at doing things lawyers do, like helping you do your Will and buying your house and trying to keep you out of court if you're lucky. When it relates to Bankruptcy, the specialists in Maitland normally 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 like there are a handful of insolvency accounting firms, there are very few insolvency legal practices in Australia, and yes if you find one you will pay a sizeable price for their expertise.

Should I speak with a financial counsellor about Bankruptcy?
Yes! There are lots of financial counselling services that can help you with this, they have no hidden agendas and they're a superb option for helping you think through your situation when it comes to Bankruptcy. If you find yourself stressing constantly, not sleeping, not eating or over-eating and thinking about money pressures regularly, then get some help.
There are also charities around Maitland like Lifeline that offer a fantastic service. They will be a sounding board if you just need someone to discuss with you what your possibilities are. Don't let your financial trouble destroy your life - ultimately it's just money.


If you really want to learn more about what to do, where to turn and what points to ask about Bankruptcy, then feel free to contact Bankruptcy Experts Maitland on 1300 795 575, or visit our website: www.bankruptcyexpertsMaitland.com.au.

Tuesday, August 9, 2016

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


When people in Maitland come to me planning to discuss Bankruptcy, they are usually filled with 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 more clear. One of the most commonplace priorities is 'Will I lose my business if I declare bankruptcy?' The concise answer is no. If you are a manager of a company any shape or size you can maintain your business if you wish to. In Maitland, businesses that end up being insolvent have a few options for instance liquidation, voluntary administration and so on. It's people who go bankrupt not companies.

Bankruptcy is a complicated area so get some expert 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 declares bankruptcy. There are several vital implications for directors of companies when it pertains to Bankruptcy in Maitland: A bankrupt can not be a director of a company, so if you have a pty ltd company you definitely will need to retire as a director once you're bankrupt.

A limitation that applies when you are actually bankrupt as a business owner is that you may be in your very own business as a sole trader only. Generally there are things you must disclose as an aspect of that but essentially you can still run your company. For some business owners, bankruptcy impacts their ability to run the business because of the licensing issues. Such as, if you run a building company, your license will be suspended once you're bankrupt and therefore you can no longer trade without that license, so make sure you are asking the right questions when it comes to licenses and Bankruptcy in Maitland.

However if your business is not impacted directly by such issues, then you'll will 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 not a thing had happened. There are laws in place to avoid what is called phoenix companies popping up out of the ashes of an old company.

Having said that, it's just an issue of talking with the right people about Bankruptcy. In this situation you may think you need a liquidator for your company, and you could be right, but bear in mind that every liquidator is distinct and have their own motives. Liquidators earn money from your liquidation - heaps of money - so what advice do you believe you will get?
When it comes to Bankruptcy, I think that giving generic advice in this area is possibly perilous as it can have very serious implications for directors and business owners. This is because it is just one of those cases where what the right advice for one business owner is the incorrect advice for the other. There are some basics however, that you may benefit from. There is no limitation to the size of the business you run even though you are bankrupt. You can employ staff. You can continue to deal with your distributors under certain conditions, the main one being you will need to meet the payment terms agreed upon.


So when it comes to Bankruptcy, don't get overly stressed about what you can and can't do as a business owner, just get the best advice ... If you would like to learn more about what to do, precisely where to turn and what questions to ask about Bankruptcy, then feel free to get in touch with Bankruptcy Experts Maitland on 1300 795 575, or visit our website: .bankruptcyexpertsMaitland.com.au.

Wednesday, July 6, 2016

Bankruptcy in Maitland - Changes that help Small Business and Entrepreneurs


Do you recognize just how much Bankruptcy Maitland is changing? The Australian Government at the end of 2015 submitted 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. At the moment, there is a minimum amount of time that you must remain bankrupt, but, this 3 year period may very well be reduced to just 12 months. So if you are inquiring about Bankruptcy, this news may be rather important to you.

Mark Carnegie in the Financial Review on the 7th December 2015 proposed 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 giving protection to 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 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 debate around this Bankruptcy issue in Maitland that some make is that this change will only encourage fraudulent behavior opening pandora's box so to speak 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 suggesting to change the maximum term of 8 years if it deems a bankrupt has appeared in an unethical or fraudulent way, and there are no suggestions to change the implications of misrepresenting yourself or financial position when filing for bankruptcy in Australia.

As a bankruptcy professional in Maitland, I have a fair share of experience when it comes to Bankruptcy. And having dealt with thousands of bankruptcy cases in Maitland I have never caught someone abusing the system or acting in an irresponsible way as to exploit the bankruptcy laws in Australia. When it comes to Bankruptcy, every week I help a small business owner or entrepreneur look at the very problematic task of bankruptcy, not once have I perceived they are happy about it. The typical small business owner or entrepreneur in Maitland does not start out taking enormous financial risks with the intent to fail. The media really loves citing the apparent wrongdoing 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 Maitland 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, managers keeping this country going.

Now there is a fine line with precisely what the government is trying to do here, since they are aiming to balance helping individuals who have made decisions out of their control, and deterring people from making oversights that land them in trouble and consequently an issue of Bankruptcy. However you likewise don't want to destroy 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 gone well.

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 insolvency were lessened because directors are distressed they'll be personally accountable in an insolvency arrangement if the new endeavour doesn't work out.

The government's proposed 'safe haven' changes for directors of companies will enable Australia to more fully explore and innovate, which will make big updates for Bankruptcy. I can not imagine, that these revisions 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 sector because the emotional cost of bankruptcy is substantial. When it comes to Bankruptcy in Maitland not a day passes 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 want some help with your debts in Maitland or are just thinking about Bankruptcy, feel free to call us here at Bankruptcy Experts Maitland on 1300 795 575, or visit our website: bankruptcyexpertsmaitland.com.au

Monday, July 4, 2016

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


When it comes to Bankruptcy Maitland, generally people aren't aware that there can be both voluntary, and involuntary bankruptcy - each have distinct methods and policies.

Involuntary bankruptcy takes place when somebody you owe money to applies to the court to declare you bankrupt. Usually when you get one of those notices, you have normally 21 days to pay all the debt. If you do not, then the creditor returns to the court and requests the court to issue a sequestration order that declares you bankrupt. A trustee is selected, and then you have 14 days to get the paperwork in and after that you are bankrupt.

You can object to a bankruptcy notice by going to court following the 21 days have expired and put your case forward, to avoid it going to the next level. Apart from the way you became bankrupt there is in reality no difference between Involuntary Bankruptcy and or Voluntary Bankruptcy - once you are declared bankrupt, they're conducted to in the very 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 tips and act on that advice. Generally I've found it's always much better to know what you can and can't do before you have someone bankrupt you. Once you are bankrupt, it's typically far too late.

Voluntary Bankruptcy

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

This question is not the very same for everyone of course, but typically 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 really 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 overlook 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 need to approach Bankruptcy.

In many ways, the ease with which companies/credit providers can default your credit file is vicious. 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 wiped off 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 nevertheless 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 review 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. Compared to countries like the United States, our bankruptcy laws are quite good.

I don't claim to know why that is but a few hundred years ago debtors went to prison. Nowadays 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 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 pay for 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 purpose of this blog was to help you decide between a few available options. When getting some advice, keep in mind that there are always alternatives when it concerns Bankruptcy in Maitland, so do some groundwork, and Good luck!


If you would like to find out more about exactly what to do, where to turn and what questions to ask about Bankruptcy, then feel free to consult with Bankruptcy Experts Maitland on 1300 795 575, or visit our website: bankruptcyexpertsMaitland.com.au.