Written 15th March 2016 – By Charles Bosse– If reading this greatly after this time, please go through some of our other blogs to confirm the information is still up to date. Do you realise just how much Bankruptcy in Port Stephens is going to be changing? The Australian Government at the end of 2015 produced some extreme plans and potential modifications to the Bankruptcy Laws in Australia, particularly when it comes to the duration of personal bankruptcy. Right now, there is a minimal quantity of time that you will need to remain bankrupt, having said that, this 3 year period may well be decreased to just 12 months. So if you are looking at going bankrupt, these changes are going to be rather important to you! How did this all come to be? Well, Mark Carnegie (an expert in this field) remarked back in December 2015 in the Financial Review that there was going to be recommendations for “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”. What issue is he aiming to repair? Currently, the laws don’t have enough protections, to the degree that Mr Carnegie, went on to point out in the Financial Review that offering security to household assets was essential since “banks just terrorise small business and the mental health consequences to society are enormous”. The trouble is Australia’s bankruptcy laws discouraged financiers from supporting start-ups, and for that reason mentoring had been “driven out of the system” and too many individuals are too anxious to try and invest or attempt to run a business. “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”. That means that currently, the existing rules are costing the overall economy and they may work for you, but they could be manipulated and in some cases the innocent fall within the gaps and get unjustly penalized. Just what is being proposed? The recommendation is to get the 3 year bankruptcy time period decreased to just 12 months when there is no indication of fraud or dishonest practices. These developments will signify a lot for Bankruptcy and will take at least 18 months to apply. What is Fraudulent Behaviour? Fraudulent behaviour is essentially a phrase that covers all the negative factors. So when it comes to Bankruptcy, this indicates that it will cover behaving dishonestly, concealing assets, taking careless risks, behaving unethically or just commonly attempting to con others. One proposed concept is that while they are minimizing the amount of time for those acting truthfully, they could actually execute a counter proposition to target those behaving especially dishonestly and raise the amount of time. Certainly there are already some arrangements in position for when you do not comply with certain rules (and I encourage you to learn more about Bankruptcy to make sure you don’t inadvertently break these guidelines) but it will be interesting to observe how this develops. So is this a Win for Small Business? Yes, most definitely! This is going to be great for small business and I really hope that you read these changes to Bankruptcy and are getting as thrilled as I am. These suggested modifications will benefit small businesses because it will motivate additional individuals to get involved and take calculated risks– There will however be consequences in effect, but it will not be unfairly reprimanding those who make genuinely honest mistakes. Most business owners I assist with Bankruptcy, are hardworking, tax paying, businesses that are keeping this country going and so I am delighted to see what will be happening next with this, and just how it will impact Bankruptcy. Bankruptcy helps save lives, and it can save yours. If you really need some assistance with your financial obligations in Port Stephens or are just thinking about Bankruptcy, don’t hesitate to contact us here at Bankruptcy Experts Port Stephens on 1300 795 575, or visit our website: www.bankruptcyexpertsportstephens.com.au
Bankruptcy in Port Stephens – Changes that can help Small Business and Entrepreneurs.