|March 3, 2017||12|
When people in Australia come to me trying to speak about Bankruptcy Advice, they are usually full of questions. The internet has lots of information, but far too much of it is confusing or contradicts itself, so I make it my mission to try and make things clearer. One of the most general troubles is ‘Will I lose my business if I declare bankruptcy?’ The quick answer is no. If you are a manager of a business any shape or size you can keep your business if you wish to. In Australia, businesses that are insolvent have a few options such as liquidation, voluntary administration and so on. It’s individuals who go bankrupt not companies.
Bankruptcy Advice is a complicated area so get some professional advice on this one if you have a business. Generally speaking, the financial obligations in a business and personal debts go together when a business owner goes bankrupt. There are some vital implications for directors of companies when it pertains to Bankruptcy Advice in Australia: A bankrupt can not be a director of a company, so if you have a pty ltd company you will likely need to resign as a director after you’re bankrupt.
A limitation that applies when you are generally bankrupt as a business owner is that you may be in your own business as a sole trader only. There are things you should reveal as a part of that but in essence you can still run your business. For some business owners, bankruptcy impacts their ability to run the business because of the licensing issues. As an example, if you run a building company, your license will be suspended once you’re bankrupt and consequently you can no longer trade without that license, so make sure you are asking the right questions when it involves licenses and Bankruptcy Advice in Australia.
Having said that if your business is not impacted directly by such issues, then you’ll need to restructure the way you run your business. There are considerations when and if you go bankrupt as a business owner: you can not acquire heaps of debt in your business, then go bankrupt and after that open the doors the next day like not a thing had happened. There are laws in place to prevent what is called phoenix companies popping up out of the ashes of an old company.
Having said that, it’s just a matter of talking with the right people about Bankruptcy Advice. Here in this circumstance you may believe you need a liquidator for your business, and you could be right, but bear in mind that every liquidator is varied and have their own motives. Liquidators profit from your liquidation – heaps of money – so just what advice do you believe you will get?
When it comes to Bankruptcy Advice, I think that giving generic advice in this area is essentially dangerous as it can have very major implications for directors and business owners. This is due to the fact that it is just one of those cases where what the right guidance for one business owner is the inappropriate advice for the other. There are some basics however, that you may benefit from. There is no reduce to the size of the business you run though you are bankrupt. You can employ staff. You can continue to deal with your providers under certain conditions, the main one being you will need to meet the payment terms agreed upon.
So when it comes to Bankruptcy Advice, don’t get overly worried about what you can and can’t do as a business owner, just get the best advice … If you wish to learn more about what to do, exactly where to turn and what questions to ask about Bankruptcy Advice, then feel free to contact Fresh Start Solutions Australia on 1300 818 575, we have offices in, Brisbane, Canberra, Sunshine Coast, Sydney, Melbourne, Gold Coast, Adelaide, Perth, Darwin and Hobart. or visit our website: www.freshstartsolutions.com.au/bankruptcy-Australia