Bankruptcy in Hobart - Who exactly do I speak to?

Should I consult with my accountant about Bankruptcy?

The answer seems obvious doesn't it: if anybody knows your financial circumstance well in Hobart, It's going to be your accountant. However, the short answer is a resounding No! It's not that your accountant may not have your best interests in mind when it comes to Bankruptcy, it's that his knowledge lie in helping you save you money at tax time, minimising your tax liability and lodging your BAS.

Most accounting degrees will devote hardly any to no time on bankruptcy, it's generally performed as a post graduate specialty program for those who wish to work in the field. Unless your accountant is an insolvency expert, he wouldn't 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 Hobart, they often tend to be large firms with very nice offices who charge accordingly.

Should I speak to my Solicitor about Bankruptcy?

No! You can speak to your solicitor in Hobart but more than likely it won't do you much good. Solicitors are really good at undertaking 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 Hobart typically have either a legal or accounting qualifications, and the reason for that is simply that you can't enrol in the post graduate study to become a qualified insolvency practitioner unless 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 a sizable price for their expertise.

Should I speak with a financial counsellor about Bankruptcy?

Yes! There are lots of financial counselling services to assist you with this, they have no hidden agendas and they're a fantastic option for helping you analyze your circumstance when it comes to Bankruptcy. If you find yourself stressing constantly, not sleeping, not eating or over-eating and thinking of money pressures constantly, then get some help.

There are also charitable organizations around Hobart like Lifeline that offer a terrific service. They will be a sounding board if you just need somebody to talk about with you what your options 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 issues to ask about Bankruptcy, then feel free to contact Bankruptcy Experts Hobart on 1300 795 575, or visit our website: www.bankruptcyexpertsHobart.com.au.

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

When people in Hobart come to me looking to talk about Bankruptcy, they are usually loaded with questions. The internet is full of information, but far too much of it is baffling or contradicts itself, so I make it my mission to try and make it more clear. One of the most frequent matters is 'Will I lose my business if I declare bankruptcy?' The concise answer is no. If you are an owner of a company any shape or size you can maintain your business if you would like to. In Hobart, businesses that are 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 professional advice on this one if you have a business. Generally speaking, the debts in a business and personal debts go hand in hand when a business owner declares bankruptcy. There are a few vital implications for directors of companies when it comes to Bankruptcy in Hobart: A bankrupt can not be a director of a company, so if you have a pty ltd company you 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. There are things you need to reveal as an aspect of that but generally 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 consequently you can no longer trade without that license, so make sure you are asking the best questions when it comes to licenses and Bankruptcy in Hobart.

Having said that if your business is not impacted directly by such issues, then you'll have to restructure the way you run your business. There are considerations when and if you go bankrupt as a business owner: you can not rack up heaps of debt in your business, then go bankrupt and afterwards open the doors the next day like practically nothing 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 a point of talking with the best people about Bankruptcy. In this circumstance you may believe you need a liquidator for your company, and you might be right, but keep in mind that every liquidator is varied and have their own motives. Liquidators make money from your liquidation - heaps of money - so exactly what advice do you believe you will get?

When it comes to Bankruptcy, I consider that giving generic advice in this area is likely risky as it can have very severe implications for directors and business owners. This is since it is one of those cases where what the right guidance for one business owner is the inappropriate advice for the other. There are some fundamentals however, that you may benefit from. There is no reduce to the size of the business you run even though you are bankrupt. You can employ staff. You can continue to deal with your suppliers 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 upset about what you can and can't do as a business owner, just get the right advice ... If you wish to learn more about what to do, exactly where to turn and what questions to ask about Bankruptcy, then feel free to reach out to Bankruptcy Experts Hobart on 1300 795 575, or visit our website: .bankruptcyexpertsHobart.com.au.

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

When it comes to Bankruptcy Hobart, typically people aren't aware that there may be both voluntary, and involuntary bankruptcy - the two have unique approaches and guidelines.

Involuntary bankruptcy happens when someone you owe money to involves the court to declare you bankrupt. Usually when you get one of these kinds of notices, you have 21 days to pay all the debt. If you don't, then the creditor goes back 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 paperwork in then afterwards you are bankrupt.

You can challenge 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 reality 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 and anxiety, torment and fear that accompanies this method is incredible. If you think you are more than likely to be made bankrupt by someone, get some suggestions and act on that advice. Generally I've found it's always far better to know what you can and can't do before you have an individual bankrupt you. Once you are bankrupt, it's normally far too late.

Voluntary Bankruptcy

On the other hand, 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 each person of course, but more often than not I find that one way you could work it out is to figure out just how long it will take you to pay all of your debts - if its longer than 3 years (the period you are declared bankrupt), then this may serve to help you make that decision, and help you to understand Bankruptcy.

Once, I had an 80 year old pensioner, who spoke to me once regarding * Bankrupcty tell me that her credit card statement calculated how long her debt would take to pay at the rate she was paying off her account, and it was 35 years! Imagine 35 years for one credit card bill.

Credit rating damage can help you think this through. If you move house and fail to remember to pay your $30 phone bill for 6 months more, it's very likely the phone service will default your credit file. That default will 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 have to approach Bankruptcy.

In many ways, the ease with which companies/credit providers can default your credit file is wrong. The punishment doesn't seem to equal the crime in my book. So if you already have defaults on your credit report for 5 years, bear in mind that bankruptcy is on your credit file for a total 7 years then its erased completely.

So if your credit rating is a big issue in trying to decide whether to enter into a Debt Agreement or Personal Insolvency Agreement or Bankruptcy remember they will all sit on your credit file for a total of 7 years. The biggest variation is that with a DA or PIA you repay the money and nevertheless have it on your file for 7 years.

Bankruptcy

I have mentioned 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 finished with no strings attached. Compared to countries like the United States, our bankruptcy laws are very generous.

I don't pretend to know why that is but a couple of hundred years ago debtors went to prison. These days I suppose the government feels 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 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 readily available options. When getting some advice, bear in mind that there are always choices when it comes to Bankruptcy in Hobart, so do some study, and Good luck!

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

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

Bankruptcy Hobart is a confusing process, and you need to ensure you get the right advice. And when it comes to your income being affected, the answer to the question is maybe. The very first thing you have to know about going bankrupt is there is no rule on how much you can earn. However, I will say that your income is a serious 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 annually. A dependant is someone who lives with you and earns less than $3,124 per year (regardless of their age).

You can make an application for a hardship variation that increases the threshold amount, if you have financial commitments in Hobart such as medical, child care, sizable travel to and from work, or a situation where your partner used to work but is not able to contribute to the family income.

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

There are many more issues involving income and what is or isn't considered income - if you're not sure, it's best to get qualified advice. The reason you need to consider your income as a part of the Big 5 questions here is that bankruptcy is in some instances not an economically sensible option.

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

If you believe that when it comes to Bankruptcy, your case is more intricate, then simply get expert advice in Hobart. I may sound like a broken record, but bear in mind that it's always a good idea to overcome these options before declaring bankruptcy, because once you have filed the paperwork it's too late to change your mind.

If you want to learn more about what to do, where to turn and what issues to ask about Bankruptcy, then don't hesitate to contact Bankruptcy Experts Hobart on 1300 795 575, or explore our website: bankruptcyexpertsHobart.com.au.

Bankruptcy in Hobart - Choices, Choice, Choices

When it comes to Bankruptcy Hobart, there are a ton of options that we get given depending on who we are, who we talk to, and exactly what has happened. One of the most common confusion 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 Hobart, most of the related information you receive on this subject will reflect the interests of the advice giver. Therefore, if you call a debt consolidation provider, I can guarantee 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 just one neat and tidy package.

I hate to tell you this but these people aren't doing it free of charge. Please don't misunderstand me: if you think your financial problems in Hobart can be fixed by paying less interest, then go on and explore the choices. Even a small amount of interest saved over years easily adds up.

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

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

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

• You've very likely reached the point where you've had more than enough, you're emotionally burnt out, you can't go on yet another day ignoring blocked calls on your phone, ignoring the demands in the mail and so forth.

Personal Insolvency Agreements

So when it comes down to Bankruptcy in Hobart, what's the huge difference between a Debt Agreement and a Personal Insolvency Agreement?

Adaptability is the main point 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 agency that advertises on TV. Essentially this process resembles Debt Agreements (DA): The trustee has a meeting with the people you owe money to and they work out a deal on your behalf. You can offer a lump sum settlement figure or enter into a payment plan, or perhaps you can offer them assets as an alternative to cash. This might sound alright when it comes to the complications with Bankruptcy - that is until you realise that one of the difficulties with PIA's is that 75 % of the people you owe money to need to come to an understanding the deal. If they don't, your plan is denied or will need to be renegotiated.

Generally the people you owe money really want all their money back in addition to interest. Sometimes they'll go for less than the amount you owe them - it's generally a percentage of the debt - but let me stress this aspect: 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.

In most cases you'll have to pay back 100 % of the debt owed. This is not just because your creditors are greedy or have a mean streak, it's because the administrators take 20 % of whatever is agreed 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 choosing 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 clever lawyers and some very clever frameworks in place and they offer 5 % of the debt, you might take it and be grateful. Sadly, ordinary punters like you and me in Hobart aren't going to get that lucky!

If you want to learn 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 Hobart on 1300 795 575, or visit our website:bankruptcyexpertsHobart.com.au.

Bankruptcy in Hobart - Changes to help Small Business and Entrepreneurs

5th February 2016 - By Charles Bosse

Do you appreciate how much Bankruptcy in Hobart is changing? The Australian Government at the end of 2015 proposed 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. Currently, there is a minimum amount of time that you must stay bankrupt, but, this 3 year period may in fact be reduced down 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 recommended that "the proposed changes to ease the burden of bankruptcy laws didn't go far enough and the government should adopt US-style laws to protect the family home".

These shifts to the issue of Bankruptcy will take 18 months to implement. Mr Carnegie, went on to say in the Financial Review that safeguarding 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 issue surrounding this Bankruptcy issue in Hobart that some come up with is that this modification will only reinforce fraudulent behavior opening pandora's box in a manner of speaking for the unscrupulous to defilement of the bankruptcy system. We have taken a look at the minimum, but on the other side of the matter, The government is not suggesting 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 recommendations to change the repercussions of misrepresenting yourself or financial situation when filing for bankruptcy in Australia.

As an insolvency professional in Hobart, I have a reasonable share of knowledge when it comes to Bankruptcy. And having dealt with thousands of bankruptcy cases in Hobart I have never struck 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 undergo the very tough task of bankruptcy, not once have I noticed they are happy about it. The typical small business owner or entrepreneur in Hobart does not start out taking enormous financial risks with the intent to fail. The media loves citing the apparent injustice that will be rampant if these changes occur, what a joke!

A Win for Small Business.

These suggested changes will be good for often the most effective and brightest in Hobart 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, employers keeping this country going.

Truth be told there is a fine line with 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 dissuading people from making missteps that land them in trouble and as a result an issue of Bankruptcy. However you also don't want to eliminate the experience and knowledge that business owners have. You surely don't want to shatter people simply because they have had a genuine failure in a large or small start-up enterprise that has not succeeded.

At the major end of town large organized 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 reduced because directors are concerned they'll be personally responsible in an insolvency arrangement if the new venture doesn't work out.

The government's suggested 'safe haven' changes for directors of companies will allow Australia to more fully explore and innovate, which will make big updates for Bankruptcy. I can not imagine, that these alterations will be detrimental 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 enormous. When it comes to Bankruptcy in Hobart not a day goes by where I don't find out the tragic experiences of relationship failures, thoughts of suicide and the list goes on.

Bankruptcy helps save lives, and it could save yours. If you really need some assistance with your debts in Hobart or are just thinking of Bankruptcy, don't hesitate to give us a call here at Bankruptcy Experts Hobart on 1300 795 575, or visit our website: www.bankruptcyexpertshobart.com.au