The majority of Australian’s have only seriously considered bankruptcy when playing a game of Monopoly with their mates! In spite of this, there are roughly 13,000 individuals that file for bankruptcy each year in Australia. It’s astonishing how rapidly individuals can go from enjoying a balanced financial position to confronting a mountain of debt. In many cases, circumstances such as loss of work, divorce, or unexpected medical costs will spark serious financial issues within just a couple of months. Instead of wrestling with these debts for many years and ignoring the elephant in the room, it’s much better to cut your losses and seek financial help as soon as possible.
Not long ago, the Australian Government proposed changes to bankruptcy laws that decrease the bankruptcy term from 3 years to 1 year. If this proposed act is passed, it will have a powerful impact on the stigma associated with bankruptcy and the financial penalties that bankrupts will experience down the road. Although many people understand the notion of bankruptcy, lots of people wouldn’t know where to start if they determined that declaring bankruptcy is the best alternative for them. To offer some insight, here are the top 5 tips on how to file for bankruptcy in Australia.
- Get guidance from a registered bankruptcy trustee
If you’ve decided that bankruptcy is the best approach for you, always talk with a registered bankruptcy trustee prior to making any concrete decisions. There is a massive difference between a firm that charges you to file for bankruptcy and a legally registered bankruptcy trustee firm. Most of the time, bankruptcy firms are not the same as registered bankruptcy trustee firms, so be sure you get the right advice the first time so you can make the best financial decision. The right advice will not only help you with your decision-making, but also put you in the best position to make a complete recovery after you have been discharged.
- Download the forms needed to file for bankruptcy
If you’ve decided that bankruptcy is the best alternative for your individual position, there are two sets of documents that you will need to complete to file for bankruptcy:
- The Debtor’s Petition, which is a 3 page document (click here 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 (click here to download: https://www.afsa.gov.au/insolvency/how-we-can-help/forms-list/statement-affairs).
- Compile your supporting documents.
In almost all bankruptcy cases, individuals have to provide evidence that their claims are correct by supplying an assortment of supporting documents. Commonly, this will include the following:.
- Income statements and personal tax returns
- Company tax returns (if you are a company 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 integral to note that failure to deliver accurate information or any effort to hide information that would otherwise relate to your bankruptcy case is a serious offence that is punishable in a criminal court.
- Complete the bankruptcy paperwork.
You must reply to each question in your bankruptcy paperwork accurately and truthfully to make sure it gets processed effectively. It is imperative that you include the address details of all your creditors 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 uncertain of which forms of ID are acceptable, check the AFSA website (https://www.afsa.gov.au). If you don’t have enough space when addressing any questions, simply print out another copy of the same page and use it to fill in further details. Furthermore, be careful to include all assets sold in the last 5 years in question 33.
- Submit your bankruptcy paperwork.
Before you submit your bankruptcy paperwork, check the date to ensure you are submitting it within 28 days of you signing it. At Bankruptcy Experts Rockhampton, we understand that all the paperwork can be a bit confusing, so if you have any concerns regarding your any of your answers, it’s best to call us on 1300 795 575 to ensure you get it right the first time. Alternatively, visit our website for additional information: www.bankruptcyexpertsrockhampton.com.au.