June 27, 2018 0

Top 5 Tips on How to Declare Bankruptcy in Australia

Posted by:Charles Bosse onJune 27, 2018

Most Australian’s have only truly thought about bankruptcy when playing a game of Monopoly with their buddies! Despite this, there are nearly 13,000 people that file for bankruptcy yearly in Australia. It’s uncanny how quickly people can go from experiencing a healthy financial position to tackling a mountain of debt. In most cases, events such as loss of employment, divorce, or unexpected medical expenses will generate serious financial problems within just a couple of months. As opposed to wrestling with these debts for years and ignoring the elephant in the room, it’s far better to cut your losses and seek financial help as quickly as possible.

A short time ago, the Australian Government proposed changes to bankruptcy laws that reduce the bankruptcy period from 3 years to 1 year. If this proposed act is passed, it will have a significant effect on the stigma related to bankruptcy and the financial repercussions that bankrupts will experience in the future. Although most people understand the concept of bankruptcy, many people wouldn’t know where to start if they decided that filing for bankruptcy is the best option for them. To offer some insight, here are the top 5 tips on how to declare bankruptcy in Australia.

  1. Seek guidance from a registered bankruptcy trustee

If you’ve determined that bankruptcy is the best option for you, always speak with a registered bankruptcy trustee prior to making any concrete decisions. There is a considerable difference between a firm that charges you to declare bankruptcy and a legitimately registered bankruptcy trustee firm. In many cases, 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 aid you with your decision-making, but also put you in the best position to make a complete recovery after you have been discharged.

  1. Download the forms required to file for bankruptcy

If you’ve decided that bankruptcy is the best alternative for your individual circumstances, there are two sets of documents that you will need to complete if you want to declare bankruptcy:

  • The Debtor’s Petition, which is a 3 page document (visit this site 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 (visit this site 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 proceedings, individuals must present evidence that their claims are accurate by supplying various supporting documents. Normally, this will include the following:

  •  Income statements and personal tax returns
  •  Company tax returns (if you are a business 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 is vital to note that failing to deliver accurate information or any attempt to hide information that would normally relate to your bankruptcy case is a severe offence that is punishable in a criminal court.

  1. Complete the bankruptcy paperwork.

You must address each question in your bankruptcy paperwork accurately and truthfully to make sure it gets processed effectively. It is crucial that you include the address information of all your lenders in the secured and unsecured sections of the bankruptcy paperwork. In the Debtor’s Petition, you’ll need to provide at the very least two types of ID. If you’re not sure of which forms of ID are acceptable, check the AFSA website (https://www.afsa.gov.au). If you run out of space when answering any questions, simply print out another copy of that page and use it to fill in additional details. Also, be careful to include all assets sold in the last 5 years in question 33.

  1. Submit your bankruptcy paperwork.

Before you submit your bankruptcy paperwork, inspect the date to ensure you are lodging it within 28 days of you signing it. At Fresh Start Solutions Perth, we understand that all the paperwork can be a bit difficult, so if you have any concerns 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: https://freshstartsolutions.com.au/bankruptcy-perth.

 

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