Bankruptcy in Melbourne - Will my income be changed if I go bankrupt?

Bankruptcy Melbourne is a confusing process, and you need to be sure you get the right advice. And when it comes to your income being affected, the answer to the question is maybe. The first thing you have to know about going bankrupt is there is no rule on how much you can earn. However, I will mention that your income is a significant consideration when working through when it comes to Bankruptcy.

The first thing you need to keep in mind about this area of Bankruptcy is just how much you can earn before you start paying back money to your creditors via your trustee (see table below).

Net income is the pre-tax/ in the hand sum you earn each year. A dependant is someone who lives with you and earns less than $3,124 per year (regardless of their age).

You can make an application for a hardship variation that raises the threshold amount, if you have costs in Melbourne like medical, child care, substantial travel to and from work, or a circumstance where your partner used to work but is not able to contribute to the family income.

Some of the insightful parts of Bankruptcy is that your employer will not be informed when you file for bankruptcy. Also, Child support is always looked at in bankruptcy, if you receive child support that is not factored in as income. If you pay child support this will be also thought about, for example if you pay $5,000 child support each year and you have no dependents living with you then your changed net income limit will be $55,332.10.

There are much more issues surrounding income and what is or isn't regarded as income - if you're not exactly sure, it's recommended to get professional advice. The reason you must consider your income as a part of the Big 5 questions here is that bankruptcy is in some cases not an economically sensible option.

If one of your creditors is the ATO (for unpaid taxes), then your tax refund will be taken by the ATO whilst you are bankrupt to contribute toward your tax bill. If you don't have a tax bill then you will keep your tax refund provided that doesn't take you over your threshold income caps.

If you think when it comes to Bankruptcy, your situation is more complicated, then simply get expert advice in Melbourne. I may seem like a broken record, but remember that it's always a good idea to work through these options prior to declaring bankruptcy, due to the fact that once you have filed the paperwork it's far too late to change your mind.

If you intend to find out more about what to do, where to turn and what issues to ask about Bankruptcy, then don't hesitate to contact Bankruptcy Advice Melbourne on 1300 879 867, or visit our website: bankruptcy-advice.com.au/Melbourne .

Bankruptcy in Melbourne - Choices, Choice, Choices

When it comes down to Bankruptcy Melbourne, there are a bunch of choices that we get given depending on who we are, who we speak with, and what exactly has gone wrong. The most common trouble I see with Bankruptcy is when it comes to choosing between Debt Consolidation, Personal Insolvency Agreements, and Bankruptcy itself.

Should I consolidate my debts?

When it comes to Bankruptcy in Melbourne, most of the facts you receive on this subject will reflect the interests of the advice giver. Therefore, if you call a debt consolidation company, I can assure you they will tell you to consolidate your debts. The debt consolidation industry is a multi-billion dollar industry making money in one very straightforward way: charging you a fee for aiding you wrap each one of your credit card and personal loans into a single neat and tidy bundle.

I hate to tell you this but these people aren't doing it free of charge. Please do not misunderstand me: if you think your financial issues in Melbourne may possibly be solved by paying less interest, then go on and explore the possibilities. Even a little amount of interest saved over years easily adds up.

Typically I find if you read this blog you've most likely tried to consolidate your debts already and come to the following realisations such as these:

• Your credit rating is no good, and your credit file definitely has nonpayments on it so nobody will offer you a loan, consolidated or otherwise,.

• By the time you work all of it out, you're so far down a hole that saving on a small amount of interest simply won't make a lot of difference,.

• You've most likely gotten to the point where you've had enough, you're emotionally exhausted, you can't go on yet another day ignoring blocked calls on your phone, ignoring the demands in the mail etc.

Personal Insolvency Agreements

So when it relates to Bankruptcy in Melbourne, what's the huge difference between a Debt Agreement and a Personal Insolvency Agreement?

Flexibility is the main thing Personal Insolvency Agreements (PIA) have in their favour. They're also administered by a registered and - might I add - regulated trustee including the government trustee ITSA, and not a private organization that advertises on TV. Essentially this process is similar to Debt Agreements (DA): The trustee has a meeting with the people you owe money to and these guys mediate a deal on your behalf. You can give a lump sum settlement figure or take part in a payment plan, or perhaps you can offer them assets rather than cash. This may sound alright when it comes to the problems with Bankruptcy - that is until you realise that one of the obstacles with PIA's is that 75 % of the people you owe money to must come to an understanding the deal. If they do not, your plan is denied or will have to be renegotiated.

Generally people you owe money really want all their money back and also interest. Sometimes they'll opt for under the amount you owe them - it's normally a percentage of the debt - but let me stress this aspect: because of all the variables involved in the negotiation process to put together a PIA its difficult to put a figure on what the people you owe money to will truly settle for.

In many cases you'll have to pay back 100 % of the debt owed. This is not just because your creditors are greedy or have a mean streak, it's because the administrators take 20 % of whatever is decideded upon with the people you owe money to. That applies whether you use a private company for this process or ITSA, the government body setup to administer to these PIAs.

When it comes to Bankruptcy and insolvency I've come across creditors opting for less 80 % on rare occasions, but that usually only occurs with a public company entering into receivership owing huge sums of money (the kind that makes the news). If you are were owed $10million and you know the people who owe you the money have a team of wise lawyers and some very clever structures in place and they offer 5 % of the debt, you might take it and be grateful. Sadly, ordinary punters like you and me in Melbourne aren't going to get that lucky!

If you want to find out more about what to do, where to turn and what questions to ask about Bankruptcy, then feel free to get in touch with Bankruptcy Advice Melbourne on 1300 879 867, or visit our website: bankruptcy-advice.com.au/Melbourne .

Bankruptcy in Melbourne - Are you going to get bitten?

When people in Melbourne ask me about Bankruptcy, I tell them the simple Native American Fable of the little boy and the Rattlesnake. An old rattlesnake asks a passing young boy to carry him to the mountain top to see one last sunset before he dies. The boy was hesitant, but the rattlesnake pledged not to bite him in exchange for the ride. They journeyed together only for the snake to in the end attack the boy despite his promise not to do so. The snake's answer was 'You knew what I was when you picked me up.

Acquiring the right financial advice in Melbourne when it relates to Bankruptcy is a whole lot like that little boy's experience, fraught with risk and danger, and usually skewed for the benefit of the individual providing the advice. In most cases you'll get bitten unless you know what you've picked up long before you move forward (avoid the rattlesnakes). I discovered the problem with getting financial advice as a teenager, and it has been vital to Bankruptcy. I'd been keeping my nose to the grindstone for a few years, and saved up a small amount of money I wanted to invest. It was the early 1980s so interest rates were very high and investing your money was quite profitable. I spent some time researching varied investment options, and I went to visit a few financial advisors. It was transparent that they had more money than I did: they had great suits and plush offices, they all appeared to exude confidence and have all the answers. What hit me was that they all had an extremely different strategy of what I should do. This frustrated me so much that it put me off the entire idea of choosing any of them.

I'm sure currently you have read more than enough on the internet to be totally puzzled about Bankruptcy and precisely what to do. It would undoubtedly be easier for me to help you learn about the nature of the financial snakes you may be grabbing while you are trying to get to the bottom of your financial concerns in Melbourne. In essence, you need to try and understand what your overarching alternatives are, do your very own research into where to proceed with your strategy for Bankruptcy, and after that approach just what you feel is best in Melbourne for your requirements. Essentially, you have 3 options for who to turn to.

The first option is a Solicitor - This may appear like the go-to solution when you seem to be in trouble. But generally there is only just so much aid they can give on this matter. There are definitely specialist legal advisors in bankruptcy, but their expertise comes along with a hefty price.

Another alternative you may think of is your accountant - they are incredibly useful and vital to the process of operating your business, but for the most part, when you are thinking about Bankruptcy, your accountant won't be much help to you anymore.

Your best bet? A Financial Counsellor that can outline debt consolidation, personal insolvency agreements, and basically all you have to figure out when it comes to Bankruptcy.

If you would like to find out more about what to do, where to turn and what questions to ask about Bankruptcy, then feel free to speak to Bankruptcy Advice Melbourne on 1300 879 867, or visit our website:bankruptcy-advice.com.au/Melbourne .

Bankruptcy in Melbourne - Changes to help Small Business and Entrepreneurs

5th February 2016 - By Charles Bosse

Do you understand just how much Bankruptcy in Melbourne is changing? The Australian Government at the end of 2015 moved for some underlying changes to the Bankruptcy Laws in Australia. One of the most significant of these is the length of time that a person is bankrupt for. At the moment, there is a minimum amount of time that you must remain bankrupt, but, this 3 year period may in fact be reduced down to just 12 months. So if you are asking about Bankruptcy, this news may be fairly important to you.

Mark Carnegie in the Financial Review on the 7th December 2015 proposed 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 safeguarding 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 prevented investors from supporting start-ups, and as a result 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 argument around this Bankruptcy issue in Melbourne that some come up with is that this revision will only encourage fraudulent behavior opening pandora's box in a manner of speaking for the unscrupulous to misuse of the bankruptcy system. We have taken a look at the minimum, but on the other side of the issue, The government is not submitting to change the maximum term of 8 years if it deems a bankrupt has behaved in an unethical or fraudulent way, and there are no propositions to change the consequences of misrepresenting yourself or financial position when filing for bankruptcy in Australia.

As a bankruptcy professional in Melbourne, I have a fair share of practical experience when it comes to Bankruptcy. And having dealt with thousands of bankruptcy cases in Melbourne I have never come across someone abusing the system or acting in an irresponsible way as to exploit the insolvency laws in Australia. When it comes to Bankruptcy, every week I help a small business owner or entrepreneur go through the very complicated task of bankruptcy, not once have I perceived they are happy about it. The ordinary small business owner or entrepreneur in Melbourne does not start out taking enormous financial risks with the intent to fail. The media prefers citing the apparent injustice that will be rampant if these changes occur, what a joke!

A Win for Small Business.

These recommended changes will be good for often the most effective and brightest in Melbourne not get kicked out of the game financially for financial decisions often outside of their control. Most small business owners I help with Bankruptcy, are hardworking, tax paying, managers keeping this country going.

There is a fine line with what exactly the government is trying to do here, because they are attempting to balance helping people who have made decisions out of their control, and discouraging people from making problems that land them in trouble and therefore an issue of Bankruptcy. However you also don't want to destroy the experience and knowledge that business owners have. You definitely don't want to smash people simply because they have had a sincere failure in a large or small start-up enterprise that has not gone well.

At the major end of town large organized 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 lowered because directors are worried they'll be personally responsible in an insolvency arrangement if the new endeavor doesn't work out.

The government's suggested 'safe haven' changes 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 modifications 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 extensive. When it comes to Bankruptcy in Melbourne not a day passes where I don't hear 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 need some help with your debts in Melbourne or are just thinking of Bankruptcy, feel free to phone us here at Bankruptcy Advice Melbourne on 1300 879 867, or visit our website: www.bankruptcy-advice.com.au/melbourne