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

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.

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.

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.

Bankruptcy in Maitland - Will my income be affected if I go bankrupt?

Bankruptcy Maitland is a confusing process, and you have to be sure you get the right suggestions. And when it comes to your income being affected, the answer to the question is maybe. The first thing you need to know about going bankrupt is there is no restriction on how much you can earn. However, I will mention that your income is a considerable consideration when working through when it comes to Bankruptcy.

The first thing you need to understand about this area of Bankruptcy is how much you can earn before you start paying back money to your creditors via your trustee (see table below).

Net income is the pre-tax/ in the hand amount of money you earn each year. A dependant is someone who lives with you and earns less than $3,124 per year (regardless of their age).

You can get a hardship variation that increases the threshold amount, if you have financial commitments in Maitland such as medical, child care, major travel to and from work, or a scenario where your spouse used to work but is no longer able to contribute to the household income.

Some of the intriguing parts of Bankruptcy is that your employer will not be told when you file for bankruptcy. Also, Child support is always taken into account in bankruptcy, if you receive child support that is not factored in as income. If you pay child support this will be also thought about, for example if you provide $5,000 child support each year and you have no dependents living with you then your amended net income limit will be $55,332.10.

There are a lot more issues surrounding income and what is or isn't thought of as income - if you're not sure, it's recommended to get professional advice. The reason you have to consider your income as a part of the Big 5 questions here is that bankruptcy is in some instances not an economically viable option.

If one of your creditors is the ATO (for unpaid taxes), then your tax refund will likely be taken by the ATO while you are bankrupt to contribute toward your tax bill. If you don't have a tax bill then you will keep your tax refund so long as that doesn't take you over your threshold income limitations.

If you think when it comes to Bankruptcy, your circumstance is more complex, then please get professional advice in Maitland. I may sound like a broken record, but keep in mind that it's always a smart idea to overcome these options before declaring bankruptcy, since once you have filed the paperwork it's too late to change your mind.

If you would like to learn more about what to do, where to turn and what problems to ask about Bankruptcy, then don't hesitate to contact Bankruptcy Experts Maitland on 1300 795 575, or go to our website: bankruptcyexpertsMaitland.com.au.

Bankruptcy in Maitland - Are you going to get bitten?

When people in Maitland ask me about Bankruptcy, I tell them the timeless Native American Fable of the little boy and the Rattlesnake. An old rattlesnake asks a passing young boy to carry him to the mountain top to discover one last sunset before he passes away. The boy was reluctant, but the rattlesnake vowed not to bite him in exchange for the ride. They journeyed together only for the snake to in the end bite the boy despite his vow not to do so. The snake's reply was 'You knew what I was when you picked me up.

Obtaining the right financial advice in Maitland when it relates to Bankruptcy is a lot like that little boy's encounter, fraught with risk and danger, and usually skewed for the benefit of the person offering the advice. Often you'll get bitten unless you know what you've picked up before you move forward (avoid the rattlesnakes). I learned the problem with receiving financial advice as a teenager, and it has been key to Bankruptcy. I'd been working hard for a few years, and saved up a little bit of money I wanted to invest. It was the early 1980s so interest rates were fairly high and investing your money was quite profitable. I spent a few years researching many different investment options, and I went to visit a few financial advisors. It was transparent that they had more money than I did: they had nice suits and plush offices, they all seemed to exude confidence and have all the solutions. What hit me was that they all had a truly different idea of what I should do. This baffled me so much that it put me off the whole idea of picking any of them.

I'm sure by now you have read more than enough on the internet to be totally overwhelmed about Bankruptcy and precisely what to do. It would probably be easier for me to help you comprehend the nature of the financial snakes you might be grabbing while you are trying to get to the bottom of your financial troubles in Maitland. Basically, you have to try and comprehend what your overarching options are, do your own research into where to proceed with your strategy for Bankruptcy, and after that approach the things you feel is best in Maitland for your requirements. Essentially, you have 3 options for who to turn to.

The first option is a Solicitor - This may feel like the go-to approach when you appear to be in trouble. But there certainly is only just so much aid they can give on this matter. There are certainly specialist legal advisors in bankruptcy, but their expertise features a hefty price.

Another option you may think of is your accountant - they are incredibly useful and vital to the process of managing your business, but for the most part, when you are thinking of Bankruptcy, your accountant won't be much help to you any longer.

Your best option? A Financial Counsellor that can talk about debt consolidation, personal insolvency agreements, and virtually all you should figure out when it comes to Bankruptcy.

If you would like to find out more about what to do, 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.

Bankruptcy in Maitland - Choices, Choice, Choices

When it comes down to Bankruptcy Maitland, there are a bunch of options that we get given depending upon who we are, who we talk to, and exactly what has happened. One of the most common trouble I see with Bankruptcy is when it comes to selecting between Debt Consolidation, Personal Insolvency Agreements, and Bankruptcy itself.

Should I consolidate my debts?

When it comes to Bankruptcy in Maitland, most of the help and advice you receive on this issue will reflect the interests of the advice giver. Therefore, if you call a debt consolidation company, I can promise you they will tell you to consolidate your debts. The debt consolidation business is a multi-billion dollar industry making money in one very simple way: charging you a fee for aiding you wrap each one of your credit card and personal loans into a single neat and tidy package.

I hate to tell you this but these guys won't be doing it free of charge. Please do not misunderstand me: if you feel your financial problems in Maitland can possibly be solved by paying less interest, then go ahead and check out the choices. Even a small amount of interest saved over years quickly adds up.

Normally I find if you read this blog you've undoubtedly tried to consolidate your debts already and come to the following realisations such as these:

• Your credit rating is no good, and your credit file already has defaults on it so no one will offer you a loan, consolidated or otherwise,.

• By the time you work all of it out, you're so far down a hole that saving a tiny bit of interest simply won't make a great deal of difference,.

• You've undoubtedly arrived at the point where you've had more than enough, you're mentally worn down, you can't go on one more day ignoring blocked calls on your phone, ignoring the demands in the mail and so on.

Personal Insolvency Agreements

So when it concerns Bankruptcy in Maitland, what's the difference between a Debt Agreement and a Personal Insolvency Agreement?

Adaptability is the main thing Personal Insolvency Agreements (PIA) have in their favour. They're also administered by a registered and - might I add - regulated trustee featuring the government trustee ITSA, and not a private firm that advertises on TV. Basically this process is similar to Debt Agreements (DA): The trustee holds a meeting with the people you owe money to and these experts mediate a deal in your place. You can give a lump sum settlement figure or enter into a payment plan, or you can offer them assets as an alternative to cash. This can sound alright when it comes to the troubles with Bankruptcy - that is up until you realize that one of the challenges with PIA's is that 75 % of the people you owe money to need to agree on the deal. If they do not, your plan is rejected or needs to be renegotiated.

Generally the people you owe money prefer all their money back and also interest. Sometimes they'll go for less than the amount you owe them - it's normally a percentage of the debt - but let me stress this part: because of all the variables involved in the negotiation process to put together a PIA its difficult to put a figure on what the people you owe money to will really settle for.

Most of the time you'll have to pay back 100 % of the debt owed. This is not because your creditors are greedy or have a mean streak, it's because the administrators take 20 % of whatever is decideded upon with the people you owe money to. That applies whether you use a private company for this process or ITSA, the government body setup to administer to these PIAs.

When it comes to Bankruptcy and insolvency I've heard of creditors settling for less 80 % on rare occasions, but that usually only occurs with a public company entering into receivership owing huge sums of money (the kind that makes the news). If you are were owed $10million and you know the people who owe you the money have a team of wise lawyers and some very clever structures in place and they offer 5 % of the debt, you might take it and be grateful. Sadly, ordinary punters like you and me in Maitland aren't going to get that lucky!

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