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When running a business, running into debt can come about quite easily. Sometimes, it only takes a few slow months to start to feel that your debts are slowly piling up and it feels harder to get back on top of things. If you have company debts that are out of control, then give us a call today. At Bankruptcy Experts we are business debt specialists. For a completely free consultation, call Bankruptcy Experts on 1300 795 575.

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If my business is in trouble should I get in touch with a liquidator?

Often, a business owner’s bookkeeper, solicitor or even family and friends will suggest contacting a liquidator to help place the company into liquidation. This is a step you should consider very carefully. We have learned, here at Bankruptcy Experts, that many people think that because you are paying the liquidator, they will look after your best interests and help to get back on your feet. UNFORTUNATELY, THIS IS CERTAINLY NOT THE CASE!

Bankruptcy Experts are on your side

Even though administrators and receivers are great people, once they’re appointed, their obligation is to your creditors (who you owe money to) and to the courts. They will then work to collect as much as possible from the assets and liquidated business to help pay off your debts. These people are not there to try and look out for your best interests. Their interest lies in paying off as much debt as possible with your assets and that’s it.

One of the biggest impacts is that, once you have signed the papers for a liquidator to be appointed to your company, you no longer have any say over your company. The liquidator will go ahead and do whatever they think is in the best interests of your creditors. In most cases, assigning a liquidator is the business owners way of paying for the death of their own business.

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One Business Owner’s Story

When the bank wouldn’t lend me any more money against the farm, I knew I was in trouble. The thought of losing the home, which had been in our family for many years, was just too much. My bookkeeper and financial advisor suggested I speak to Bankruptcy Experts, which I didn’t do. As I was in such significant debt, I spoke to a liquidation firm who advised that liquidation was my only way out. My accountant even said that as I am paying the liquidator, and I was going into voluntary liquidation, that I would be looked after. This was not the case.

I spoke to some liquidators who seemed very capable and professional. They advised they would help me as much as possible to work through my money problems. It felt like they knew what I was going through and that I could trust that they would take care of me.

When I signed the paperwork to assign the liquidators, everything was out of my hands. They asked for the keys to my equipment and the home and everything was taken over. The money I had coming in was gone, the sale of my equipment was taken over and everything was gone. Even my savings account was frozen the next day. What I thought was going to be a way out of my problems ended up being a huge nightmare. I lost everything.

What is the best strategy if my business is in difficulty?

One of the best things you can do in a situation like this is: PREPARE.

There is so much to consider, so before you surrender your business and all of your control to a liquidator, it is best to contact Bankruptcy Experts to guide you through what can be a terribly confusing and tough time. Most of the time, we can help guide you to a solution that will work with you, not against you and your business.

It may sound easy, but there are a lot of rules and regulations in place surrounding the process of insolvency. It’s due to these regulations and the large amount of data to process that talking to Bankruptcy Experts is a good idea. We can explain to you in clear details what is involved with each option available to you. We specialise in pre-liquidation strategies, so we can discuss your options first before involving a liquidator. To get started, call us on 1300 795 575.

What if someone else is winding up my company?

If the ATO or a creditor is winding up your company, they will have a liquidator appointed by the courts. You do still have some options, however. There is plenty to know and understand and there are things you should know to help protect yourself.

The best option is to give us a call at Bankruptcy Experts for a free consultation. We can provide some advice, so it is best to get us involved in your situation as soon as possible. The sooner you get us involved, the more options that can be available to you. If you have received a notice or court order in the mail, contact us as soon as possible on 1300 795 575.

Can I continue to run a business if I have been the director of a company that has been liquidated?

This is one of the most commonly asked questions when it comes to business and bankruptcy. Yes, you can continue to run a business, but you cannot be the director of a company that has been liquidated.

There are some rules and regulations that you will need to be aware of and ensure that you are adhering to them. You also need to make sure you are in a position where you can create the right path for any future ventures. Liquidation isn’t the end of your business life, by any means. We can help to guide you in the right direction to build a new life after liquidation. There are a few options and most of the time, people are just not aware of them. We can explain all these options and more at Bankruptcy Experts, and help you to achieve your business goals.

What do I need to do?

One of the biggest things you should do is be prepared.

Liquidators aren’t working for you, even though you are paying them a fee. Your creditors also aren’t working for you, no matter how much you pay off your bills. Your friends and family love you, but unfortunately, they don’t always know the correct answers when it comes to business and bankruptcy. Although their heart is in the right place, their advice may not be correct or work best for you and your situation. They may have heard from other friends that a liquidator is the best option to help get rid of a company and start afresh. There’s also the assumption again, that the liquidator will be working for you.

THIS IS NOT THE CASE! The only ones who work for you would be people like us here at Bankruptcy Experts. You are our client and we want to get the result you want in the best way possible. We can offer you a free consultation and get started when you’re ready. Simply give us a call on 1300 795 575.

What do we do?

One of the key things we do at Bankruptcy Experts is we analyse your needs and work through your choices. We then help to guide you through your options so you can make the right choice for you. We want to work with you so that you can get the best possible outcome, all whilst protecting whatever we can.

We also communicate the right way with your creditors. Ultimately, we want to help you to resolve the situation as easily as possible. Call us now at Bankruptcy Experts on 1300 795 575.

What if I have an ATO Debt?

The ATO will usually issue companies with Wind-Up Notices, Statutory Demands or even a Director’s Penalty Notice on you or the company. If you receive one of these, do not disregard your mail.

The best thing to do from here is to act fast. Sometimes, communication is what is required and other times, winding up the company is, in fact, the best answer. A lot of the time, negotiation is also required. No matter what is needed to help resolve the issue, we can help you to work through your options, create a plan and support you along the way.

What If I have received a notice from the Tax Office?

One of the most important things to note is that YOU MUST NOT LET THEM LAPSE. It will be best to contact us as soon as you receive them and we can help you work through the procedures as quickly as possible to get the most favourable outcome for you.

Once we have assessed your needs, we can create an action plan to help recommend to you the best course of action. From there, you can review your options and choose where to go from there. Call Bankruptcy Experts today for a free consultation on 1300 795 575.

ATO – DIRECTOR’S PENALTY NOTICE

Directors Be Warned

It is important to understand that as a business owner, these changes are quite serious and you should understand how these changes can and will impact you and your business. If you have a tax debt then you may be issued with a Director Penalty Notice by the ATO.

What does it mean if I have a Director’s Penalty Notice?

What the Director Penalty Notice aims to do is to make directors liable for the unpaid tax debt of the company. As the director, you won’t be able to avoid personal liability for a PAYG ATO debt, which comes with a Director Penalty Notice, if the following applies:

The debt is older than three months and or your debt wasn’t reported to the ATO within 3 months of the due date.
As a director, you may also be liable for your companys unpaid superannuation liability when you get a penalty.
Directors, and associates of directors, may now also be liable for a new personal income tax liability. This will make directors and their associates possibly liable for a company’s unpaid PAYG withholding liability.

The debt is older than three months and or your debt wasn’t reported to the ATO within 3 months of the due date.

As a director, you may also be liable for your company’s unpaid superannuation liability when you get a penalty.

Directors and associates of directors may now also be liable for a new personal income tax liability. This will make directors and their associates possibly liable for a company’s unpaid PAYG withholding liability.

Do I have any choices?

Yes, you do. If the company has an ATO debt or you have received a Director’s Penalty Notice, it is very important to get specialised advice, as there will be a few options that you will need to consider. To get started, call Bankruptcy Experts on 1300 795 575.

What if I ignore the notice?

If you don’t comply with the ATO’s notice, there can be serious consequences. Such consequences could include losing personal assets such as cars, property, shares and personal bankruptcy for the company’s debts.

STATUTORY DEMANDS

What is a Statutory Demand?

A Statutory Demand is a demand produced under 459E of the Corporations Act. This particular document is not issued by the Court. A Statutory Demand demands that the Debtor Company pay a specified sum of money within 21 days from the date of the delivery of the demand on the Debtor Company.

If the debt is contested, or if there are exceptions in the document, the company should immediately get independent legal advice and apply to the Court to establish the demand aside on the grounds that the liability, then the subject of the Statutory Demand is in fact contested. This application MUST be made inside 21 days.

What if the Statutory Demand expires unsatisfied?

Section 95(A) of the Corporations Act provides that a company is solvent if it is able to pay its debts as and when they are due. Therefore, the test as to whether or not a company is insolvent is that it isn’t able to pay its debts as and when they are due to be paid.

Under Section 459C of the Act, the company is assumed to be insolvent if a company has failed to comply with a Statutory Demand. The delivery to a Debtor Company and non-compliance with the Statutory Demand will then provide ‘proof’, which is enough for a creditor to apply to the Court for the consideration and appointment of a liquidator to the company.

Can the Statutory Demand just turn up in the post?

Yes, it might be delivered face-to-face or simply appear in the mail as registered mail.

WINDING UP NOTICE

What is a Wind-Up Notice?

Following a Statutory Demand is a wind-up notice. The Court has the power to wind up a business if it is unable to pay its debts. A liquidator is then appointed who then has the responsibility to turn the assets of the business into cash. The cash is then disbursed in the order set out in the Corporations Act. Basically, the notice is a letter to let you know that on a particular date a liquidator will be appointed by the courts to take over your company if you don’t pay your debts.

Who can send me a Wind-Up Notice?

No, you will not. If a company is placed into liquidation, this does not automatically mean the director will be made bankrupt. However, the process of winding up a company is very similar to the process of a person going through declaring bankruptcy. The ATO can issue a Director’s Penalty Notice at any time, which is why it is best to act quickly when you receive a notice from the ATO. As soon as possible, contact Bankruptcy Experts for a free consultation on 1300 795 575.

Will I be personally obligated for my businesses debt?

No. The liquidation of a company does not automatically imply the director will be made bankrupt; however, the process of winding up a company is similar to the process of having a person declared bankrupt. Having said that, the ATO can issue a Directors Penalty Notice any time, so it’s best to act quickly. For a free consultation contact Liquidators Experts on 1300 795 575.

What happens if I can not pay the debt within the 21 Days?

A liquidator will be appointed and you will no longer When you cannot pay a debt within the specified timeframe, a liquidator will be appointed. At this point, you will no longer be the director of the company. A liquidator is then appointed by the Court, who then takes full control of the business. Everything from clients, cheque accounts, assets, cash, money that’s owed to the company and cheque accounts are no longer yours. As awful as it sounds, this basically means that it is over. Your company which you have spent years working on will no longer be yours. All assets will be sold and offices, shops or factories will all be taken over by the liquidator. They can and will also change the locks of your buildings and assets and your services will no longer be required. Every aspect possible will be under the control of the liquidator.

Do I have any options prior to the Liquidators seizing my business?

Yes, you do. This is often mistaken and business owners really do not realise there are other options. We offer a free initial consultation to guide you to work through this problem. Our team of professionals can spare you tremendous distress. However, you must act quickly! Contact Bankruptcy Experts today on 1300 795 575.

Do I have any options once the Liquidators have arrived?

No. Unfortunately, the company is no longer in your control, which is why it is vital to contact us as soon as possible.

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