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Written 15th March 2016 – By Charles Bosse– If checking this out considerably after this date, feel free to read through a few of our additional blogs to confirm the details is still up to date. Do you realise just how much Bankruptcy in Whitsundays is going to be changing? The Australian Government at the end of 2015 produced some extreme plans and prospective changes to the Bankruptcy Laws in Australia, specifically when it comes to the duration of personal bankruptcy. At this time, there is a minimum amount of time that you must stay bankrupt, having said that, this 3 year period may very well be reduced to just 12 months. So if you are looking into insolvency, these alterations are going to be relatively significant to you! How did this all come to be? Well, Mark Carnegie (an expert in this field) commented back in December 2015 in the Financial Review that there was going to be tips for “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”. What complication is he trying to fix? At the moment, the legislations don’t have enough protections, to the extent that Mr Carnegie, went on to point out in the Financial Review that giving safeguards to household assets was necessary since “banks just terrorise small business and the mental health consequences to society are enormous”. The trouble is Australia’s bankruptcy laws discouraged investors from supporting start-ups, and for that reason mentoring had been “driven out of the system” and too many individuals are too troubled to try and invest or attempt to run a small business. “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”. That implies that at the moment, the existing legislations are costing the economy and they may benefit you, but they could be manipulated and occasionally the innocent fall within the voids and get unjustly penalized. What is being proposed? The proposal is to have the 3 year bankruptcy period decreased to just 12 months when there is no indication of fraudulence or unethical behaviour. These developments will signify a lot for Bankruptcy and will likely take at the very least 18 months to execute. What is Fraudulent Behaviour? Fraudulent behaviour is effectively a term that includes every one of the bad points. So when it comes to Bankruptcy, this indicates that it will deal with behaving dishonestly, hiding assets, taking careless risks, behaving unethically or just commonly trying to scam people. One proposed concept is that whilst they are decreasing the amount of time for those individuals acting truthfully, they may in fact carry out a counter proposal to target those acting especially dishonestly and maximize the time. Certainly there are currently some arrangements in effect for whenever you do not observe certain regulations (and I encourage you to read more about Bankruptcy to make sure you don’t unintentionally break these guidelines) but it will be interesting to see exactly how this develops. So is this a Win for Small Business? Yes, absolutely! This is going to be excellent for business and I hope that you read these alterations to Bankruptcy and are getting as excited as I am. These proposed changes will benefit small businesses because it will encourage additional individuals to get engaged and take calculated risks– There will nonetheless be penalties in place, but it won’t be unfairly punishing individuals who make genuinely honest mistakes. Most business owners I help with Bankruptcy, are hardworking, tax paying, companies that are helping keep this country going and so I am delighted to see what will be happening next with this, and how it will affect Bankruptcy. Bankruptcy helps save lives, and it could possibly save yours. If you really require some assistance with your financial debts in Whitsundays or are just thinking about Bankruptcy, don’t hesitate to phone us here at Bankruptcy Experts Whitsundays on 1300 795 575, or visit our website: www.bankruptcyexpertswhitsundays.com.au