June 27, 2018 0

Top 5 Tips on How to File For Bankruptcy in Australia

Posted by:Charles Bosse onJune 27, 2018

The majority of Australian’s have only honestly thought about bankruptcy when playing a game of Monopoly with their buddies! Despite this, there are around 13,000 individuals that file for bankruptcy each year in Australia. It’s astounding how quickly people can go from being in a healthy financial position to confronting a mountain of debt. In most cases, circumstances like loss of work, divorce, or unforeseen medical expenditures will induce serious financial challenges within just a few months. As opposed to wrestling with these debts for years and ignoring the elephant in the room, it’s much better to cut your losses and seek financial guidance as quickly as possible.

A short time ago, the Australian Government proposed changes to bankruptcy laws that lower the bankruptcy duration from three years to 1 year. If this proposal is passed, it will have a powerful impact on the stigma linked to bankruptcy and the financial consequences that bankrupts will face in the future. While lots of folks understand the concept of bankruptcy, lots of people wouldn’t know where to start if they determined that filing for bankruptcy is the best alternative for them. To offer some insight, here are the top 5 tips on how to declare bankruptcy in Australia.

  1. Seek advice from a registered bankruptcy trustee

If you’ve determined that bankruptcy is the best choice for you, always talk with a registered bankruptcy trustee before making any concrete decisions. There is a vast difference between a firm that charges you to file for bankruptcy and a legitimately registered bankruptcy trustee firm. Most of the time, bankruptcy firms are not the same as registered bankruptcy trustee firms, so ensure you get the right advice the first time so you can make the best financial decision. The right advice will not only assist you with your decision-making, but also put you in the best position to make a healthy recovery after you have been discharged.

  1. Download the forms needed to file for bankruptcy

If you’ve decided that bankruptcy is the best option for your individual circumstances, there are two sets of documents that you will need to complete in order to file for bankruptcy:

  • The Debtor’s Petition, which is a 3 page document (click on this link to download: https://www.afsa.gov.au/insolvency/how-we-can-help/forms-list/debtors-petition).
  • The Statement of Affairs, which is a 25 page document (click on this link to download: https://www.afsa.gov.au/insolvency/how-we-can-help/forms-list/statement-affairs).
  1. Compile your supporting documents.

In nearly all bankruptcy cases, individuals need to present evidence that their claims are correct by supplying an assortment of supporting documents. Usually, this will include the following:

  •  Income statements and personal tax returns
  •  Company tax returns (if you are a company owner)
  •  Centrelink benefits statement (if relevant)
  •  Formal child support notices
  •  Any family law orders
  •  Any court orders
  •  Wills of any deceased estate of which you are the beneficiary
  •  All transaction statements from transferred assets over the last 5 years

It’s important to note that failure to provide accurate information or any attempt to conceal information that would otherwise relate to your bankruptcy case is a serious offence that is punishable in a criminal court.

  1. Complete the bankruptcy paperwork.

You must answer each question in your bankruptcy paperwork accurately and honestly to make sure it gets processed correctly. It is paramount that you include the address details of all your creditors in the secured and unsecured sections of the bankruptcy paperwork. In the Debtor’s Petition, you’ll need to provide at least two types of ID. If you’re unclear of which forms of ID are accepted, check the AFSA website (https://www.afsa.gov.au). If you run out of space when addressing any questions, simply print out another copy of that page and use it to fill in further information. Furthermore, be careful to include all assets sold in the last 5 years in question 33.

  1. Submit your bankruptcy paperwork.

Before you lodge your bankruptcy paperwork, inspect the date to make sure you are submitting it within 28 days of you signing it. At Fresh Start Solutions Hobart, we understand that all the paperwork can be a bit overwhelming, so if you have any inquiries regarding your any of your answers, it’s best to phone us on 1300 818 575 to ensure you get it right the first time. Alternatively, visit our website for additional information: http://freshstartsolutions.com.au/bankruptcy-hobart.

 

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