How to file for bankruptcy in Australia | Finance Study

Are you an Australia citizen or a resident facing financial difficulties that demand you to declare yourself bankrupt? Well, then you need some basic bankruptcy law information to guide you on how to do it. Before you jump both legs into making this worthwhile decision that has the capacity to affect your future financial obligations even further. Bankruptcy is a consideration made if you are not in a position to settle your liabilities with your currently owned assets. Nevertheless, before you think of declaring yourself bankrupt you need to put in mind the implications it has in your future life.

Australian residents experience bankruptcy claim differently, it deviates slightly from how it is done elsewhere in the world. For instance, in Australia a creditor has the capacity to lodge a petition demanding that a certain debtor be declared bankrupt. Despite, the technique used the effect and procedure of placing a claim is barely the same. The 1996 act of parliament in Australia informs the procedure and the legislation that revolve around bankruptcy in this country. Only persons can become bankrupt, this law excludes companies because they undergo liquidation instead.

Once you consider been declared bankrupt as the cheapest alternative you need to contact the registrar to guide through the procedure of acquiring this status. Australia citizens, residents and registered businessmen are the only persons allowed to file bankruptcy claims if the debt was incurred within the confines of the country.

The person filing the suite to be declared bankrupt has to present a current financial statement, debtor?s petition and an acknowledgement letter to the authorities in this case the Insolvency and Trustee Service Australia. The financial statement must expressly show beyond unreasonable doubt that the debtor is unable to raise the amount owed by the creditor. Usually, if the petition is placed by a creditor the set minimum debt threshold should be $5000. Upon completion of papers verification and approval you can now begin the bankruptcy claim process.

The bankruptcy claim process is systematic. It begins by noting the amount owed to each creditor including their physical addresses. Step two you should indicate your income in terms of how much money you earn including all assets that legally belong to you.

Insolvency trustee agencies are widespread across the country therefore step number three involves contacting your home based insolvency branch. Here you are offered a bankruptcy trustee who will always act as the contact person pending your suite. Lastly, present in person dully filled debtor?s petition and financial statement papers to the Official Receiver. The official Receiver has the mandate to approve or nullify your proposal if it does not meet the criteria identified above. If they accept and approve your petition you are declared bankrupt legally. At this stage your trustee should issue you with a bankruptcy number.

Australian law demand, that one can only remain bankrupt for a maximum period of three years within which you must maintain contact with your trustee constantly. In as such,bankruptcy can take you up to eight years without being discharged if the claim owner does not maintain contacts with the trustee.

This entry was posted on Monday, February 18th, 2013 at 8:56 am and is filed under Bankruptcy, Finance. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

Source: http://financestudy.com.au/2013/02/18/how-to-file-for-bankruptcy-in-australia/

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