Bankruptcy Regulations and Procedures

The Bankruptcy Advisory Centre is an AFSA and ASIC registered adviser with over 30 years of experience providing bankruptcy regulations and procedure advice in Australia, helping everyday Australians resolve their financial problems. Our expert team offers various debt solutions for individuals and businesses across Australia from our Sydney, Melbourne, Brisbane, and Perth offices.

Bankruptcy Regulations

Bankruptcy is a legal process in Australia that relieves individuals and businesses who cannot pay their debts. There are various bankruptcy regulations and procedures, including bankruptcy laws, exemptions, bankruptcy trustees, voluntary bankruptcy, involuntary bankruptcy, bankruptcy discharge, and the relationship between bankruptcy and insolvency.

Bankruptcy in Australia is governed by the Bankruptcy and Insolvency Act 1966, which sets out the legal framework for insolvency. Additionally, the new bankruptcy regulations 2021 are secondary legislation governing bankruptcy administrative and procedural requirements for the bankruptcy process.

The Bankruptcy Process

The bankruptcy process in Australia involves the appointment of a bankruptcy trustee who manages the affairs of the bankrupt estate. The trustee is responsible for realising the bankrupt estate’s assets and distributing the proceeds to the creditors. Either the debtor or a creditor may start the bankruptcy process.

Personal Bankruptcy

Personal bankruptcy in Australia is a legal process that allows individuals to declare themselves bankrupt and discharge their debts. This process is available to individuals who cannot pay their debts as they fall due. Creditors can file for personal bankruptcy voluntarily or involuntarily.

A Bankruptcy Trustee

A bankruptcy trustee is appointed to manage the affairs of the bankrupt estate. The trustee is responsible for realising the bankrupt estate’s assets, distributing the proceeds to the creditors, and investigating the bankrupt’s affairs.

Bankruptcy Exemptions

Certain assets are exempt from bankruptcy in Australia, including household goods, tools of trade, and superannuation. These exemptions are designed to provide some protection for the bankrupt’s assets.

Voluntary Bankruptcy Australia

In Australia, the debtor declares themselves bankrupt and submits an application to the Australian Financial Security Authority. The Bankruptcy Advisory Centre can assist you with this paperwork and act as your bankruptcy trustee.

Involuntary Bankruptcy

Involuntary bankruptcy in Australia occurs when a creditor files a petition with the court to declare an individual or business bankrupt because they owe a debt of at least $10,000 and have not paid. The debtor will receive a bankruptcy notice and have 21 days to pay the debt or dispute the petition. If the debt is not paid or denied, the creditor will issue a sequestration order, and a bankruptcy trustee is appointed to manage the debtor’s affairs and sell off assets to repay the creditors.

Bankruptcy Discharge

A bankruptcy discharge usually occurs after three years but is subject to certain conditions. The release is available to individuals in voluntary or involuntary bankruptcy who have completed the bankruptcy process and met the requirements of paying off their debt to creditors.

Bankruptcy and Insolvency

Bankruptcy and insolvency in Australia are closely related, as insolvency often leads to a company’s bankruptcy. Personal insolvency is the state of being unable to pay debts as they fall due, while bankruptcy is a legal process for dealing with insolvency.

Need more Information About Bankruptcy Regulations and Procedures in Australia?

“Bankruptcy Advisory Centre offers personal debt solutions tailored to your situation. Claiming bankruptcy or personal insolvency may be your best option if you are drowning in debt and constantly stressed over your financial future. We help individuals and businesses make informed decisions about their financial future by assisting them in understanding bankruptcy regulations and procedures, including personal and corporate bankruptcy, exempt property bankruptcy, bankruptcy income contributions, trustees, voluntary bankruptcy, discharge, and the relationship between bankruptcy and insolvency.”