State By State Bankruptcy Employment Restrictions
Bankruptcy is tricky, and it is difficult not to worry about in your life after bankruptcy. Fortunately, the Bankruptcy Act of Australia doesn’t stop you from being employed or even running a business.
However, restrictions exist on specific industries or titles, for example, where the work needs a licence from the industry or government. It is essential to be aware of these restrictions and talk to a professional to avoid future problems. Let us have a closer look at employment restrictions for bankrupts.
Categories of Employment and Business Restrictions for Bankrupts
The Australian Financial Security Authority doesn’t inform employers when an individual goes bankrupt. However, it is essential to remember that this doesn’t prevent your existing or potential employers from inquiring whether you are bankrupt or stop them from searching the National Personal Insolvency Index, a list of discharged bankrupts.
While the restrictions aren’t imposed on all industries and jobs, certain licencing authorities and industry associations might have specific limits you must be aware of. These restrictions mostly fall into two categories, which are as follows:
- The first kind of restriction is the one that imposes a mandatory ban on bankrupts from taking part in a particular occupation. If you have been bankrupt within a specific time frame, you can’t be employed in that particular occupation. Some examples include security agents, justices of peace, members of parliament, and bankruptcy trustees.
- The second kind of restriction is where bankruptcy might become a reason for restrictions on employment. Suppose you have been bankrupt but can convince them to relax this restriction in your individual case of bankruptcy. In that case, it can become one of the many factors being considered to determine if you are eligible to participate. One example is the taxation agents’ regulations.
However, there is inconsistency throughout the different occupations as each industry has its own specifications, for instance, regarding the bankruptcy’s time length and the decision-makers’ scope of discretion. You should consult a specialist or discuss it with your employer to determine if there are any restrictions or requirements you would face in your particular industry.
Generally, the restrictions are as follows:
- An individual who has gone bankrupt can’t manage or monitor a trust account—for example, an accountant or a solicitor.
- Some restrictions are imposed by licensing or professional bodies in specific professions and trades.
- You can’t be a company director as per the Corps Act.
- You can’t be involved in a self-managed superfund as per the Superannuation Act (SIS).
- You can’t manage an organisation without receiving the court’s permission.
- You can run a business, but there might be certain restrictions if you are a sole trader. For instance, if the business’s name doesn’t include your name, you must inform any party you deal with about your bankruptcy. If you incur debt, you may have to disclose your bankruptcy regardless of if the debt exceeds $5,000.
There might be some restrictions or limitations in occupations where you have to deal with other people’s money in an unsupervised arena.
State By State Bankruptcy Employment Restrictions
While certain employment restrictions exist on continuing certain professions and trades, these might differ from state to state. You must consult a professional bankruptcy agent or a relevant government agency to determine how bankruptcy would impact your employment under the Bankruptcy Act. Here is a list of professions or trades in different states by the Australian Financial Security Authority (AFSA) that might have certain employment restrictions:
Remember that if your profession or trade is mentioned here, it might not necessarily mean you can’t continue working in your profession. It would be best if you got in touch with relevant authorities regarding the Bankruptcy Employment Restrictions and part 9 debt agreement employment restrictions to determine your next steps.
Consequences of Bankruptcy Employment Restrictions
“Becoming bankrupt doesn’t stop you from working or running your own business. There is also no limit to the income you can earn or save while you are bankrupt. However, there are State by State Bankruptcy Employment Restrictions that you might face. Therefore, it is important to consult a professional bankruptcy advisor to ensure your employment or business goes smoothly throughout your bankruptcy, and you don’t have to face future problems.”
Andrew Bell Bankruptcy Advisor
With over 30 years of experience in debt solutions and bankruptcy in Australia Andrew can find a solution for you.
“Nothing is more satisfying to me than knowing that I’ve helped someone get back on their feet by guiding them through the Bankruptcy Process. Rest assured, you’re in good hands with me as we solve your financial problems together.”