Owing money is stressful enough these days, and many people and businesses have been struggling to keep afloat. But when it gets to the point that you cannot pay your own or your business’s debts when they are due, don’t assume that the only way out is bankruptcy.
Talk to an insolvency lawyer to find out your options. But before you do, make sure you stop trading. It is illegal to trade when you or your business are insolvent.
An insolvency lawyer will review your circumstances of what you or your business owe, and how things have escalated to reach the point of not being able to pay your debts.
They can advise you on your options, such as restructuring your debt, or help to protect your company from liquidation by providing ‘safe harbour’ advice. In 2017, ‘safe harbour’ provisions were introduced to the Corporations Act (Cth) to allow a ‘safe harbour’ defence against insolvent trading claims for company directors.
It’s important to get legal advice as soon as possible because an insolvency lawyer can help you understand your options and set you on the path to turn your business around.
While bankruptcy may provide relief if you are unable to pay your debts, and give you a fresh start, it comes with some long-term consequences, and many may surprise you.
Your bankruptcy details will be permanently listed on the National Personal Insolvency Index (NPII). Your bankruptcy status will be listed on your credit report for seven years, which may affect your ability to get a loan or credit. Your bankruptcy will affect your ability to travel overseas. You cannot be a company director and your bankruptcy may affect your income, employment and your business.
Bankruptcy will usually last for three years and one day and this will start from a date determined by the following circumstances:
*If you owe someone $10,000 or more, they may be able to apply to the court to have you made bankrupt. This is called a creditor’s petition.
Whether it’s a business bankruptcy or personal bankruptcy, before you head down the bankruptcy path, talk to a bankruptcy lawyer.
A skilled bankruptcy lawyer will help to protect your interests and manage your obligations. They’ll help you fill out the many forms required, negotiate with creditors, apply for debtor’s petitions, issue bankruptcy notices, and respond to letters of demand from creditors. They’ll make the process as smooth as possible for you.
If your own or your business financial circumstances are dire, and you are concerned whether insolvency or bankruptcy is the correct path to take, talk to an expert bankruptcy lawyer or insolvency lawyer as soon as possible.
Contact Buckley Lawyers now, for specialist insolvency or bankruptcy advice—and your peace of mind.