Do you recognize just how much Bankruptcy
in Australia is changing? The Australian Government in late 2015 moved for some
innate changes to the Bankruptcy Laws in Australia. The most significant of
these is the length of time that a person is bankrupt for. Right now, there is
a minimum amount of time that you must stay bankrupt, however, this 3 year
period may very well be reduced to just 12 months. So if you are inquiring
about Bankruptcy, this news may be pretty important to you.
Mark Carnegie in the Financial Review on
the 7th December 2015 recommended that "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".
These alterations to the issue of Bankruptcy
will take 18 months to implement. Mr Carnegie, went on to say in the Financial
Review that safeguarding family assets was very important because "banks
just terrorise small business and the mental health consequences to society are
enormous".
The problem is Australia's bankruptcy laws
prevented investors from supporting start-ups, and therefore mentoring had been
"driven out of the system".
"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.".
Fraudulent Behavior.
The issue around this Bankruptcy issue in
Australia that some make is that this modification will only strengthen
fraudulent behavior opening pandora's box in a manner of speaking for the
unscrupulous to defilement of the bankruptcy system. We have taken a look at
the minimum, but on the other side of the issue, The government is not
recommending to change the maximum term of 8 years if it deems a bankrupt has
behaved in an unethical or fraudulent way, and there are no proposals to change
the consequences of misrepresenting yourself or financial situation when filing
for bankruptcy in Australia.
As a bankruptcy professional in Australia,
I have a decent share of practical experience when it concerns Bankruptcy. And
having dealt with thousands of bankruptcy cases in Australia I have never
caught someone abusing the system or acting in an immoral way as to exploit the
bankruptcy laws in Australia. When it comes to Bankruptcy, every week I help a
small business owner or entrepreneur undergo the very difficult task of
bankruptcy, not once have I believed they are happy about it. The standard
small business owner or entrepreneur in Australia does not start out taking
enormous financial risks with the intention to fail. The media loves citing the
apparent misuse that will be rampant if these changes occur, what a joke!
A Win for Small Business.
These proposed changes will be good for
often the most effective and brightest in Australia not get rejected of the
game financially for financial decisions often out of their control. Most small
business owners I help with Bankruptcy, are hardworking, tax paying, employers
keeping this country going.
There certainly is a fine line with what
the government is trying to do here, since they are aiming to balance helping
people who have made decisions out of their control, and discouraging people
from making miscalculations that land them in trouble and as a result an issue
of Bankruptcy. However you likewise don't want to destroy the experience and
knowledge that business owners have. You surely don't want to smash people
simply because they have had a genuine failure in a large or small start-up
enterprise that has not succeeded.
At the major end of town large reputable
companies have long been criticised for their failure to innovate - lets face
it they would be more likely to do so if the risks of insolvency were decreased
because directors are distressed they'll be personally responsible in an
insolvency arrangement if the new project doesn't work out.
The government's suggested 'safe haven'
modifications for directors of companies will allow Australia to more fully
explore and innovate, which will make big changes for Bankruptcy. I can not
imagine, that these revisions will be destructive to Australia's economy,
indeed these bankruptcy laws will save the tax payer in all areas of health -
Especially in the mental health field because the emotional cost of bankruptcy
is enormous. When it comes to Bankruptcy in Australia not a day goes by where I
don't hear the tragic experiences of relationship failures, thoughts of suicide
and the list goes on.
Bankruptcy helps save lives, and it could
save yours. If you need some help with your debts in Australia or are just
thinking about Bankruptcy, don't hesitate to phone us here at Liquidation
Service on 1300 795 575, or visit our website: www.liquidationservice.com.au
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