Written 15th March 2016 – By Charles Bosse– If reading this considerably after this date, please go through some of our other blog posts to validate the data is still up to date. Do you know just how much Bankruptcy in Darwin is likely to be changing? The Australian Government by the end of 2015 developed some extreme propositions and possible alterations to the Bankruptcy Laws in Australia, particularly when it relates to the duration of bankruptcy. At this time, there is a minimal quantity of time that you will need to stay bankrupt, having said that, this 3 year period may well be lowered to just 12 months. So if you are considering bankruptcy, these developments are going to be quite critical to you! Exactly how did this all come to be? Well, Mark Carnegie (an expert in this area) remarked back in December 2015 in the Financial Review that there was going to be suggestions 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 trouble is he attempting to fix? Currently, the legislations don’t have adequate protections, to the level that Mr Carnegie, continued to say in the Financial Review that offering security to household assets was needed because “banks just terrorise small business and the mental health consequences to society are enormous”. The issue is Australia’s bankruptcy laws discouraged financiers from assisting start-ups, and for that reason mentoring had been “driven out of the system” and too many people are too troubled to try and invest or try to run a small 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”. This means that at the moment, the existing legislations are costing the overall economy and they may work for you, but they can possibly be exploited and sometimes the innocent fall within the voids and get unfairly penalized. What is being proposed? The recommendation is to have the 3 year bankruptcy duration decreased to just 12 months when there is no indication of fraudulence or dishonest practices. These improvements will signify a lot for Bankruptcy and will take at least 18 months to implement. What is Fraudulent Behaviour? Fraudulent behaviour is basically a phrase that covers all the bad factors. So when it comes to Bankruptcy, this means that it will address acting dishonestly, concealing assets, taking reckless risks, acting unethically or just generally trying to con individuals. One proposed concept is that whilst they are reducing the amount of time for those acting truthfully, they could actually implement a counter proposition to target those acting significantly dishonestly and maximize the amount of time. There are already some provisions in effect for whenever you do not comply with particular regulations (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 see exactly how this develops. So is this a Win for Small Business? Yes, most definitely! This is going to be terrific for small business and I hope that you read these changes to Bankruptcy and are getting as excited as I am. These suggested changes will be good for small businesses because it will motivate more people to get engaged and take calculated risks– There will nonetheless be consequences in place, but it will not be unfairly penalizing those who make truly honest miscalculations. Most business owners I help with Bankruptcy, are hardworking, tax paying, businesses that are keeping this country going and so I am thrilled to observe what will be occurring next with this, and just how it will affect Bankruptcy. Bankruptcy helps save lives, and it can save yours. If you really require some support with your financial debts in Darwin or are just considering Bankruptcy, do not hesitate to call us here at Bankruptcy Experts Darwin on 1300 795 575, or visit our website: www.bankruptcyexpertsdarwin.com.au
Bankruptcy in Darwin – Changes that can help Small Business and Entrepreneurs.