Sometimes a business can be operated by a person or in partnership structure. When this business is encountering financial difficulties and other options have been exhausted, then it is likely the individual(s) involved in operating the business may need to consider voluntary bankruptcy in order to deal with the financial position.
If after considering your financial position and carefully evaluating all the options, you may have to consider filing for voluntary bankruptcy to deal with your debts. It is critical that you take active steps because if left unattended, a creditor that you owe money to is able to initiate action and obtain a sequestration order from the Court declaring you bankrupt. Our advice to individuals always is to recognize and deal with their financial position as early as possible in order that then commence rebuilding their lives. A voluntary bankruptcy normally lats for 3 years and 1 day.
- Enables you to obtain immediate relief from the pressure of creditors and make a fresh start
- Any legal action against you relating to your creditors will cease
- Upon your trustee being appointed and creditors being informed, they can no longer contact you directly about your debt. Such communications are with your Trustee.
- Provides a regime where you are allowed to retain certain assets (for example superannuation) and income (subject to thresholds and other conditions).
- Enables certain assets and other recoveries to be made and provides a fair and equitable distribution of realisations from your estate to creditors.
It is important to remember that bankruptcy is a legal process (insert AFSA what is bankruptcy hyperlink) and therefore it is important to seek advice from a qualified professional about whether it is right for you.
Michael Jones and Bruce Gleeson are Registered Trustees and can act as Trustee in the above circumstances. They both have significant expertise to ensure you receive right solution to deal with your financial position.
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