Bankruptcy in Tablelands – Changes that can help Small Business and Entrepreneurs.
Written 15th March 2016 – By Charles Bosse– If reading this significantly after this date, feel free to check out a few of our other blog posts to verify the details is still up to date. Do you know just how much Bankruptcy in Tablelands 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, especially when it involves the duration of insolvency. Right now, there is a minimal amount of time that you will need to remain insolvent, having said that, this 3 year duration may very well be reduced to just 12 months. So if you are looking into insolvency, these alterations are going to be quite significant to you! How did this all happen? 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 problem is he trying to resolve? Presently, the laws don’t have enough protections, to the extent that Mr Carnegie, proceeded to mention in the Financial Review that offering security to household assets was essential because “banks just terrorise small business and the mental health consequences to society are enormous”. The problem is Australia’s bankruptcy laws discouraged financiers from supporting start-ups, and therefore mentoring had been “driven out of the system” and several people are too worried to try and invest or try 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 indicates that at the moment, the present legislations are costing the overall economy and they may benefit you, however they can be exploited and sometimes the innocent fall in the voids and get unfairly penalized. What is being proposed? The recommendation is to have the 3 year bankruptcy time period minimized to just 12 months when there is no sign of fraud or unethical behaviour. These developments will signify a lot for Bankruptcy and will take approximately 18 months to implement. What is Fraudulent Behaviour? Fraudulent behaviour is essentially a phrase that includes all the negative points. So when it comes to Bankruptcy, this means that it will cover acting dishonestly, concealing assets, taking reckless risks, acting unethically or just generally trying to scam people. One proposed idea is that although they are reducing the amount of time for those individuals acting honestly, they may in fact carry out a counter proposal to pinpoint those behaving particularly dishonestly and maximize the time. There are already some provisions in position for when you do not comply with particular guidelines (and I encourage you to learn more about Bankruptcy to make sure you don’t inadvertently break these rules) but it will be interesting to see exactly how this evolves. So is this a Win for Small Business? Yes, absolutely! This is going to be terrific for business and I really hope that you are reading these alterations to Bankruptcy and are getting as delighted as I am. These suggested changes will benefit local businesses because it can encourage additional individuals to get engaged and take calculated risks– There will still be consequences in effect, but it will not be unfairly punishing people who make genuinely honest mistakes. Many small business owners I assist with Bankruptcy, are hardworking, tax paying, companies that are keeping this country going and so I am delighted to observe what will be taking place next with this, and how it will impact Bankruptcy. Bankruptcy helps save lives, and it could possibly save yours. If you really need some support with your financial debts in Tablelands or are just thinking about Bankruptcy, feel free to phone us here at Bankruptcy Experts Tablelands on 1300 795 575, or visit our website: www.bankruptcyexpertstablelands.com.au