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Written 15th March 2016 – By Charles Bosse– If reading this greatly after this time, feel free to read through a few of our other blogs to establish the data is still up to date. Do you realise just how much Bankruptcy in Albury is going to be changing? The Australian Government at the end of 2015 formulated some extreme propositions and potential modifications to the Bankruptcy Laws in Australia, specifically when it relates to the duration of bankruptcy. At the moment, there is a minimal amount of time that you will need to remain bankrupt, having said that, this 3 year duration may very well be decreased to just 12 months. So if you are looking into going bankrupt, these developments are going to be quite important to you! Exactly how did this all come to be? Well, Mark Carnegie (an expert in this area) reviewed back in December 2015 in the Financial Review that there was going to be suggestions 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 repair? Presently, the legislations don’t have adequate protections, to the level that Mr Carnegie, continued to point out in the Financial Review that offering protection to household assets was necessary since “banks just terrorise small business and the mental health consequences to society are enormous”. The issue is Australia’s bankruptcy laws deterred financiers from assisting start-ups, and for that reason mentoring had been “driven out of the system” and lots of people are too anxious to try and invest or try 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”. This indicates that presently, the present rules are costing the overall economy and they may work with you, however they can possibly be exploited and sometimes the innocent fall within the gaps and get unfairly punished. Just what is being proposed? The recommendation is to have the 3 year bankruptcy time period reduced to just 12 months when there is no sign of fraud or dishonest behaviour. These improvements will signify a lot for Bankruptcy and will take approximately 18 months to implement. What is Fraudulent Behaviour? Fraudulent behaviour is basically a phrase that addresses all the bad things. So when it comes to Bankruptcy, this means that it will address behaving dishonestly, concealing assets, taking reckless risks, behaving unethically or just commonly trying to scam others. One proposed concept is that although they are minimizing the amount of time for those individuals behaving honestly, they could in fact implement a counter proposal to target those acting especially dishonestly and maximize the time. Certainly there are already some arrangements in place for when you do not observe certain rules (and I encourage you to find out more about Bankruptcy to make sure you don’t accidentally break these rules) but it will be interesting to observe how this evolves. So is this a Win for Small Business? Yes, definitely! This is going to be excellent for small business and I really hope that you read these changes to Bankruptcy and are getting as delighted as I am. These suggested changes will be good for businesses because it can encourage more people to get involved and take calculated risks– There will nonetheless be consequences in effect, but it will not be unfairly reprimanding individuals who make genuinely honest mistakes. Most small business owners I help with Bankruptcy, are hardworking, tax paying, companies that are keeping this nation going and so I am excited to observe what will be happening next with this, and just how it will impact Bankruptcy. Bankruptcy helps save lives, and it can save yours. If you really require some assistance with your debts in Albury or are just thinking about Bankruptcy, feel free to phone us here at Bankruptcy Experts Albury on 1300 795 575, or visit our website: www.bankruptcyexpertsalbury.com.au