A question that is frequently asked by an individual that may be contemplating bankruptcy is what happens to the income they earn during bankruptcy. In short, the Bankruptcy Act 1966 (“the Act”) provides that the individual is assessed regarding the requirement to pay compulsory income contributions for each year of their bankruptcy. Given that the […]
As a bankruptcy trustee I am often asked by individuals facing personal financial hardship what will happen to my credit rating if I formally declare myself bankrupt More importantly individuals are often concerned about their ability in future to borrow money for important things such as a house or a car. The legal position is […]
There is no doubt that the global economy is going through enormous structural change as the weight of global economic activity increasingly shifts towards Asia. The above diagram demonstrates that in 2012 the Asia-Pacific region together with the Indian subcontinent accounts for in excess of 36% of world GDP. Australia has benefited greatly from this structural […]
Although external factors do play a part in the success or failure of a business research shows that internal factors such as the quality of management is far more important.
The report prepared by the Australian Securities and Investments Commission (ASIC) on the reason for company failures has consistently concluded that the major reason for company failures is “poor strategic management “. The second most common reason cited for business failure is a failure to maintain proper books and records. This of course can be seen as one in the same as bad strategic management.
According to a recent report issued by the ASIC the main reason for Corporate insolvencies can be related to ”bad strategic management” It may seem that exchange rate fluctuations are beyond the control of business managers and it is obvious that currency variations have a major contributor on Australian businesses. If a business relies heavily […]
Whilst interest rates in Australia are at historic lows and we remain in relatively good financial shape when compared to other Western Economies, what lies beneath needs to be understood. During the calendar years 2010, 2011 and 2012 we have seen corporate insolvency levels across Australia increase on average at almost 4.5% per annum. Further, […]
It is true that superannuation funds are ordinarily protected property in the event that an individual becomes bankrupt. There is however and exception to this general principle where a superannuation contribution has been made to defeat the creditors. In particular Section 128 B of the Bankruptcy Act makes specific provision in relation to transfers of property to a super fund where it can be inferred from all of the circumstances that at the time of the transfer, the transferor was or was about to become insolvent. The kinds of transactions envisaged by these provisions relate to unusually large and irregular payments that are outside of the normal scope of the individual’s contribution to superannuation.
One issue that frequently arises in relation to the administration of bankrupt estates is the difficulty of the bankrupt being a beneficiary under a Will.
Divisible property is defined broadly in the Bankruptcy Act and it includes, not only property owned by the bankrupt at the time of the bankruptcy, but also property acquired by the bankrupt after bankruptcy up until the time of the discharge, which is usually three years. This is referred to as “after acquired property”.
Antecedent transactions Business owners are often anxious about what might happen to their private assets should their business runs into difficulties and ultimately fail. Many individuals contemplate transferring private property into some form of entity separate from the individual (such as a company or a trust), or transferring the property to a close relative or […]
This is a very basic summary of the current regime in Australia applicable to personal insolvency and Bankruptcy of Individuals
