When people in Australia come to me hoping to speak about Bankruptcy Advice, they are typically full of 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 it clearer. One of the very most usual problems is ‘Will I lose my business if I declare bankruptcy?’ The quick answer is no. If you are an owner of a company any shape or size you can keep your business if you want to. In Australia, businesses that become insolvent have a few options for instance, liquidation, voluntary administration and so on. It’s individuals who go bankrupt not companies.
Bankruptcy Advice is a complex area so get some expert advice on this one 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 a few essential implications for directors of companies when it pertains to Bankruptcy Advice in Australia: A bankrupt can not be a director of a company, so if you have a pty ltd company you are going to need to resign as a director soon after you’re bankrupt.
A limitation that applies when you are bankrupt as a business owner is that you can be in your own business as a sole trader only. Generally there are things you have to reveal as an aspect of that but generally you can still run your company. For some business owners, bankruptcy affects their ability to run the business because of the licensing issues. As an example, 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 ideal questions when it involves licenses and Bankruptcy Advice in Australia.
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 company, then go bankrupt and afterwards open the doors the next day like nothing at all 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 speaking with the suitable people about Bankruptcy Advice. In this circumstance you may believe you need a liquidator for your company, and you could be right, but keep that in mind every liquidator is unique and have their own motives. Liquidators profit from your liquidation – heaps of money – so what advice do you think you will get?
When it comes to Bankruptcy Advice, I think that giving generic advice in this area is likely unsafe as it can have very considerable implications for directors and business owners. This is because it is one of those cases where what the right advice for one business owner is the inappropriate advice for the other. There are some fundamentals however, that you may benefit from. There is no limit to the size of the business you run when you are bankrupt. You can employ staff. You can constantly deal with your manufacturers under certain conditions, the main one being you will need to meet the payment terms agreed upon.
So when it concerns Bankruptcy Advice, don’t get overly worried about what you can and can’t do as a business owner, just get the appropriate advice … If you want to learn more about what to do, exactly where to turn and what questions to ask about Bankruptcy Advice, then feel free to consult Bankruptcy Advice Australia on 1300 879 867, we have offices in, Brisbane, Canberra, Sunshine Coast, Sydney, Melbourne, Gold Coast, Adelaide, Perth, Darwin and Hobart. or visit our website: www.bankruptcy-advice.com.au/