Do you recognize
how much Bankruptcy Gladstone is
changing? The Australian Government at the end of 2015 put forward some
foundational 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 remain bankrupt, having said that,
this 3 year period may in fact be reduced to just 12 months. So if you are
asking 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
modifications to the issue of Bankruptcy will take 18 months to implement. Mr
Carnegie, went on to say in the Financial Review that shielding family assets
was necessary because "banks just terrorise small business and the mental
health consequences to society are enormous".
The problem is
Australia's bankruptcy laws discouraged 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 debate about
this Bankruptcy issue in Gladstone that some make is that this variation will
only motivate fraudulent behavior opening pandora's box so to speak for the
unscrupulous to abuse of the bankruptcy system. We have looked at the minimum,
but on the other side of the matter, The government is not recommending to
change the maximum term of 8 years if it deems a bankrupt has operated in an
unethical or fraudulent way, and there are no proposals to change the
repercussions of misrepresenting yourself or financial situation when filing
for bankruptcy in Australia.
As an insolvency
professional in Gladstone, I have a reasonable share of knowledge when it comes
to Bankruptcy. And having dealt with thousands of bankruptcy cases in Gladstone
I have never uncovered someone abusing the system or acting in a reckless way
as to exploit the bankruptcy laws in Australia. When it comes to Bankruptcy,
every week I help a small business owner or entrepreneur look at the very tough
task of bankruptcy, not once have I perceived they are happy about it. The
average small business owner or entrepreneur in Gladstone does not start out
taking enormous financial risks with the intent to fail. The media prefers
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 best and brightest in Gladstone not get
kicked out 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.
Certainly there
is a fine line with the things the government is trying to do here, because
they are trying to balance helping people who have made decisions out of their
control, and dissuading people from making problems that land them in trouble
and as a result an issue of Bankruptcy. However you likewise don't want to
eliminate the experience and knowledge that business owners have. You
absolutely don't want to shatter people simply because they have had a genuine
failure in a large or small start-up project that has not succeeded.
At the big end
of town large established 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
bankruptcy were lessened because directors are distressed they'll be personally
liable in an insolvency arrangement if the new venture doesn't work out.
The government's
proposed 'safe haven' modifications for directors of companies will allow
Australia to more fully explore and innovate, which will make big updates for Bankruptcy.
I can not imagine, that these variations will be detrimental to Australia's
economy, in reality these bankruptcy laws will save the tax payer in all areas
of health - Especially in the mental health sector because the emotional cost
of bankruptcy is enormous. When it comes to Bankruptcy in Gladstone not a day
passes where I don't find out the tragic stories of relationship failures,
thoughts of suicide and the list goes on.
Bankruptcy helps
save lives, and it could save yours. If you really need some help with your
debts in Gladstone or are just thinking of Bankruptcy, don't hesitate to phone
us here at Bankruptcy Experts Gladstone on 1300 795 575, or visit our website: bankruptcyexpertsgladstone.com.au
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