Invest in a failed business venture? Constantly juggle credit card balances? Have a mountain of outstanding bills and debts?
Today, personal insolvency is an undeniable issue. Finding yourself in financial difficulties can place significant pressure on your health and relationships. Heed the warning signs and take the requisite steps to regain control as early as possible.
If you do find yourself facing insolvency, you have options, including:
A Trustee is appointed to investigate and administer the affairs of the bankrupt estate, realise assets and pay dividends. The bankrupt’s divisive property vests with the Trustee. Voluntary bankruptcy provides relief from the burden of debt to enable the bankrupt to make a fresh start, quickly. However, it can impact on the bankrupt’s ability to earn income, obtain future credit and travel overseas.
Part X Arrangement
The individual and creditors determine how the individual’s affairs should be administered outside of the rigid code of bankruptcy. This is seen as an alternative to bankruptcy for insolvent individuals who are able to reach agreement with their creditors regarding the settlement of their debts.
Part IX Arrangements
Also known as ‘debt agreements’, these arrangements are only available to individuals with a debt under a certain threshold. The individual is required to make a formal proposal to their creditors, such as, payment of less than the full amount, a moratorium on payment, or periodic payments of income. The proposal must be accepted via a ‘special resolution’ passed by at least seventy five per cent in value and a majority in number of creditors.
Your insolvency checklist
The time to act quickly is when:
Cash flow is decreasing
Unpaid creditors are pressing
Accounts are unable to be paid when due
Your debt burden is becoming unmanageable
Sales and profits are down
You don’t have a plan to boost business
Your tax bills remain unpaid
Your unpaid bills and credit card demands are mounting up
JH Business Services & Taxation
Accounting | Business Advisory | Taxation
Specialist in small to medium business
& personal taxation
29-31 Lexington Drive
Individual Tax Return
BAS & IAS Lodgment Service
Set Up of New Business Entities
Partnership Tax Return
Business Tax Planning
Company Tax Return
Business Health Check
Trust Tax Return
Business Funding & Finance
SMSF Tax Return
Budget & Cash Flow Forecast