Tuesday, August 8, 2017

Bankruptcy Mackay, So what is the Deal with Debts?

Which Debts are cleared away if I go Bankrupt?

The basic answer is that when it involves Bankruptcy most debts are wiped, and I have also included a summary below for you to look at.

But, simply put 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 such as HECS or FEE-HELP. These debts are not erased 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 affixed to it. So for instance 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 erased if you simply hand back 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 could be wiped but the asset will need to be sold or returned. This is just one aspect that, when it comes to Bankruptcy, it is necessary to get professional advice - like that offered at Bankruptcy Experts Mackay.

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 erased with bankruptcy. If you have a business with any sort of debts find some advice because it is not always so self-explanatory. Feel free to call us right here over at Bankruptcy Experts Mackay if you have any type of questions on 1300 795 575. Or feel free to go to our website: www.bankruptcyexpertsMackay.com.au

What about my business or Company debts?

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

Monday, May 22, 2017

Bankruptcy, Will I lose my Superannuation?


Bankruptcy in Australia can be convoluted and confusing. A question we normally get asked here at Bankruptcy Experts Mackay 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 nothing 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 increased 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 Mackay is not proposing this article is the whole story, if you have any questions feel free to contact us on 1300 795 575. Regardless if you call us or another person it does not matter, just please don't walk into bankruptcy blind when it comes to your SMSF indeed we advise you ask for both legal and financial advice before proceeding with any of the actions recommended 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 facing 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 position of trustee presents a lot of legal rules, and if you are in this role I would highly encourage you to become knowledgeable about them all-- including 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 rather damaging to a SMSF and as you can imagine the process of Bankruptcy for a SMSF is rather convoluted.

How long do I have 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 want to consider your whole structure and see to it that it is meeting the basic conditions, including things like having a new trustee that is not experiencing issues with Bankruptcy. The Australian Tax office will offer you a 6 month 'grace period' to get this done before you face penalties. And keep in mind, sometimes the absolute best 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 constantly keeping the ATO informed of what is happening. This indicates you need to let them know that you have a bankruptcy issue with your current trustee, that they are being removed as soon as possible know who the new trustee/director is. The Bankrupt will also have to inform the ATO using the form NAT 3036 (Found on the ATO website) and they must also notify ASIC of their resignation.

During 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 uncertain call Bankruptcy Experts Mackay 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 have to appoint a new director, and it will then become their responsibility to oversee the sale and relocation of assets into a managed fund. If there are two or more members, than the bankrupt member will have to resign and the other member will remove the property and halve the proceeds. They would then have to decide if they choose to remain as a single member SMSF, or if they intend to roll it all into a managed fund. If both members are entering bankruptcy, then they would need to sell all assets immediately and transfer the liquid assets to the managed fund.

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

A simple solution ...


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

Thursday, January 19, 2017

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


Bankruptcy Mackay is a complicated process, but I know from meeting with thousands facing the likelihood of bankruptcy over the years, that almost nothing troubles people more than the idea of losing the family house. Almost every person is on an emotional level connected to their home - it's where the kids have grown up, it's where you appreciate life on a day to day basis.

Will you lose your home if you go bankrupt? The answer is a resounding maybe. (not very helpful, I know) People generally think it's an inevitable consequence and a part of Bankruptcy, and as a result 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 accepted to pay back the debt you are in.

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

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

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

What this seems like is that yes the trustee will sell your house right? Not necessarily. The only reason the trustee will sell any asset including your house is to get money to pay back 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 locations 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 Mackay and are looking at Bankruptcy: get an expert to help you through this process, there are lots of variables in these scenarios that have to be considered.

You might wonder, why would the bank want bankrupt clients? wouldn't they prefer 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 you keep up to date with your monthly payments then the bank wants you in there at all costs. Ultimately however it's not the bank's call if the trustee figures out that there is ample 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 make a note of the value of your house and the amount of money 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 offer you peace of mind, don't use your neighbours' gut feel tips or a real estate agents advice to get to this figure. When you get a valuer out to your home, make certain you tell the valuer to value the property for a quick sale, make certain 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 delicate sale. Nowadays that's not the case, but if you meet them and let them know you need to sell the house in the next 30 days you may sway the result. The idea is that you want a reasonable sell now figure.

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

When it concerns Bankruptcy and houses, another notable consideration is ownership, in most cases houses are purchased 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 doesn't, the equity is only factored on the 50 % of the property.

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


If you really want 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 Mackay on 1300 795 575, or visit our website: www.bankruptcyexpertsMackay.com.au.

Wednesday, November 16, 2016

Bankruptcy in Mackay - Who exactly do I talk to?


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

Most accounting degrees will invest very little to no time on bankruptcy, it's generally done 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 implications 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 Mackay, they have the tendency to be large firms with very nice office spaces who charge accordingly.

Should I speak to my Solicitor about Bankruptcy?
No! You can talk to your solicitor in Mackay but more than likely it won't do you much good. Solicitors are really 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 comes to Bankruptcy, the specialists in Mackay usually have either a legal or accounting background, and the main reason for that is simply that you can't start in the post graduate study to become a qualified insolvency practitioner except if 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 an ample price for their expertise.

Should I speak to a financial counsellor about Bankruptcy?
Yes! There are plenty of financial counselling services to help you through this, they have no hidden agendas and they're a great option for really helping you analyze your situation when it comes to Bankruptcy. If you end up 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 Mackay like Lifeline that offer a wonderful service. They will be a sounding board if you just need somebody to review with you what your choices are. Don't let your financial issue destroy your life - ultimately it's just money.

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

Monday, August 8, 2016

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


When people in Mackay come to me hoping to discuss Bankruptcy, they are constantly loaded with questions. The internet has lots of information, but far too much of it is baffling or contradicts itself, so I make it my mission to try and make things more clear. One of the most universal worries is 'Will I lose my business if I declare bankruptcy?' The quick answer is no. If you are a manager of a company any shape or size you can maintain your business if you want to. In Mackay, businesses that become insolvent have a few options such as liquidation, voluntary administration and so on. It's individuals who go bankrupt not businesses.

Bankruptcy is a complicated area so get some skilled advice on this if you have a business. Generally speaking, the financial debts in a business and personal debts go hand in hand when a business owner declares bankruptcy. There are some necessary implications for directors of companies when it comes to Bankruptcy in Mackay: A bankrupt can not be a director of a company, so if you have a pty ltd company you will definitely need to retire as a director once you're bankrupt
.
A constraint that applies when you are 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 will need to reveal as a part of that but in a nutshell 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 consequently you can not trade without that license, so make sure you are asking the ideal questions when it involves licenses and Bankruptcy in Mackay.

But 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 after that open the doors the next day like virtually nothing had happened. There are laws in place to prevent what is called phoenix companies appearing out of the ashes of an old company.

Having said that, it's just an issue of speaking to the correct people about Bankruptcy. Here in this circumstance you may believe you need a liquidator for your company, and you could be right, but bear in mind that every liquidator is varied and have their own motives. Liquidators earn money from your liquidation - heaps of money - so exactly what advice do you think you will get?

When it comes to Bankruptcy, I consider that giving generic advice in this area is potentially damaging 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 incorrect advice for the other. There are some basics however, that you may benefit from. There is no limit to the size of the business you run even though 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 extremely upset 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, precisely where to turn and what questions to ask about Bankruptcy, then feel free to contact Bankruptcy Experts Mackay on 1300 795 575, or visit our website: .bankruptcyexpertsMackay.com.au.

Wednesday, July 6, 2016

Bankruptcy in Mackay - Changes to aid Small Business and Entrepreneurs



Do you recognize how much Bankruptcy Mackay is changing? The Australian Government at the end of 2015 put forward 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 the moment, there is a minimum amount of time that you must stay bankrupt, but, this 3 year period may in fact be reduced to just 12 months. So if you are inquiring about Bankruptcy, this news may be considerably 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 improvements 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 essential 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 debate surrounding this Bankruptcy issue in Mackay that some make is that this revision will only motivate 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 proposing 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 effects of misrepresenting yourself or financial situation when filing for bankruptcy in Australia.

As a bankruptcy professional in Mackay, I have a fair share of experience when it comes to Bankruptcy. And having dealt with thousands of bankruptcy cases in Mackay I have never uncovered someone abusing the system or acting in an irresponsible way as to exploit the insolvency laws in Australia. When it comes to Bankruptcy, each week I help a small business owner or entrepreneur suffer through the very difficult task of bankruptcy, not once have I thought they are happy about it. The typical small business owner or entrepreneur in Mackay does not start out taking enormous financial risks with the intent to fail. The media prefers citing the apparent injustice 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 best and brightest in Mackay 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, managers keeping this country going.

There is a fine line with exactly what the government is trying to do here, since they are trying to balance helping individuals who have made decisions out of their control, and deterring people from making miscalculations 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 undoubtedly don't want to shatter people simply because they have had an honest failure in a large or small start-up enterprise that has not panned out.

At the major 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 decreased because directors are troubled they'll be personally responsible in an insolvency arrangement if the new project 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 updates for Bankruptcy. I can not imagine, that these changes will be destructive to Australia's economy, in reality these bankruptcy laws will save the tax payer in all areas of health - Especially in the mental health industry because the emotional cost of bankruptcy is extensive. When it comes to Bankruptcy in Mackay not a day passes 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 are in need of some assistance with your debts in Mackay or are just thinking of Bankruptcy, don't hesitate to contact us here at Bankruptcy Experts Mackay on 1300 795 575, or visit our website:bankruptcyexpertsmackay.com.au

Monday, July 4, 2016

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


When it comes to Bankruptcy Mackay, commonly people aren't aware that there are both voluntary, and involuntary bankruptcy - each have distinct approaches and guidelines.

Involuntary bankruptcy arises when a person you owe money to involves the court to declare you bankrupt. Commonly when you get one of these particular notices, you have 21 days to pay all the debt. If you don't, then the creditor returns to the court and asks the court to provide a sequestration order that declares you bankrupt. A trustee is assigned, and then you have 14 days to get the documents in and then you are bankrupt.

You can challenge 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. Other than the way you became bankrupt there is in fact no distinction between Involuntary Bankruptcy and or Voluntary Bankruptcy - once you are simply declared bankrupt, they're overseen to in the very same way.

However, when it comes to Bankruptcy for this, the stress and anxiety, torment and fear that accompanies this process is incredible. If you think you are prone to be made bankrupt by someone, get some assistance and act on that advice. Generally I've found it's always more ideal to know what you can and can't do before you have someone else bankrupt you. Once you are bankrupt, it's usually too late.

Voluntary Bankruptcy

Nevertheless, when it comes to Bankruptcy, sometimes there are moments that it is the most ideal option. So you may want 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 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 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 fail to remember 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 sit 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 have to approach Bankruptcy.

In many ways, the ease with which companies/credit providers can default your credit file is unjustifiable. The punishment doesn't seem to equal the crime in my book. So if you actually have defaults on your credit report for 5 years, keep 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 element in trying to decide whether to take part 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 difference 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 stated the word a few times now, but when it comes down to it, Bankruptcy is the biggest part, and the part most 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 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 very good.

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 thinks 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 insured.

There is much more that can be said about doing this and Bankruptcy in general but the objective of this blog was to help you decide between a few available options. When getting some advice, keep in mind that there are always choices when it involves Bankruptcy in Mackay, so do some homework, 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 contact Bankruptcy Experts Mackay on 1300 795 575, or visit our website:bankruptcyexpertsMackay.com.au.