When it involves Bankruptcy, there are 2 kinds of individuals– those who have chosen to declare bankruptcy and those individuals declared insolvent by others (Their creditors).
When it comes to Bankruptcy in Australia, normally individuals aren’t aware that there is both voluntary, and involuntary bankruptcy– and this is very important because sometimes individuals don’t know that others can declare them bankrupt– and also if this occurs you have particular rights and’ responsibilities attached.
Involuntary bankruptcy takes place when an individual you owe money to involves the court to declare you insolvent. This will result in you being given with a notice that, usually when you obtain one of these kinds of notices, you have 21 days to pay all the debt. If you do not, then the creditor goes back to the court and asks the court to supply a sequestration order that proclaims you insolvent. Throughout this time you will have a brief window in which you can argue and put your case forward concerning why it should not advance to the next degree and the reason why you should not be declared bankrupt. But once the determination has been made, you will be bankrupt and experiencing the same steps as people who took that path willingly.
Having said that, when it concerns Bankruptcy you can picture that the involuntary process is full of even more tension, worry and fear since other people are taking control of your entire life. My most important tip with Bankruptcy and involuntary bankruptcy is that if you believe that it might occur, get qualified recommendations on bankruptcy as quickly as feasible, even if you are just worried about bills and fear that it could continue to escalate. I am sure that you can envision that it is better to recognize what you can and can’t do before getting pushed into that circumstance. Once you are insolvent, it’s generally far too late to take action.
Well if you have been declared bankrupt, you won’t really have numerous choices but to move through the process and you will definitely want to get qualified recommendations to make sure you are declaring properly, not breaking any guidelines, and will have the bankruptcy discharged as early as achievable.
Fortunately is that in Australia the arrangements for bankruptcy are really generous: you could declare bankruptcy owing millions of dollars and after 3 years it’s all finished with no strings attached. Compared with nations like the United States, our insolvency laws are quite good.
I do not pretend to know why that is, but a couple of hundred years ago debtors went to prison. Nowadays I presume the government believes that the sooner it can get you back on your feet working and paying tax, the better. It makes much more sense than locking you up which costs the taxpayer in any case.
Personal bankruptcy will clear away the vast majority of your several financial debts, (including tax debts to the ATO) but remember the few exemptions- the main ones being Centrelink Debts, Court Fines like parking and speeding fines, HECS or Fee Help loans, and money to pay for a car accident if the car was not insured.
There is much more that might be explained about this and Bankruptcy in general so when getting some guidance, keep in mind that there are always options when it involves Bankruptcy in Australia, so do some research, and good luck!
If you want to learn more about exactly what to do, where to turn and what inquiries to ask about Bankruptcy, then don’t hesitate to get in touch with Bankruptcy Advice on 1300 879 867, or visit our website: www.bankruptcy-advice.com.au.