Bankruptcy in Sydney - Will my income be influenced if I go bankrupt?

Bankruptcy Sydney is a complicated process, and you should make sure you get the right suggestions. And when it comes to your income being affected, the answer to the question is maybe. The very first thing you need to know about going bankrupt is there is no rule on how much you can earn. However, I will mention that your income is a serious consideration when working through when it comes to Bankruptcy.

The very first thing you need to know about this area of Bankruptcy is the amount you can earn before you start paying back money to your creditors via your trustee (see table below).

Net income is the pre-tax/ in the hand portion you earn each year. A dependant is someone who lives with you and earns less than $3,124 per year (regardless of their age).

You can look for a hardship variation that increases the threshold amount, if you have costs in Sydney such as medical, child care, major travel to and from work, or a scenario where your partner used to work but is not able to contribute to the family income.

Some of the informative parts of Bankruptcy is that your employer will not be alerted when you file for bankruptcy. Also, Child support is always looked at in bankruptcy, if you receive child support that is not factored in as income. If you pay child support this will be also thought about, for example if you pay $5,000 child support each year and you have no dependents living with you then your amended net income limit will be $55,332.10.

There are much more issues covering income and what is or isn't considered income - if you're uncertain, it's ideal to get specialist advice. The reason you have to consider your income as a part of the Big 5 questions here is that bankruptcy is in some cases not an economically practical option.

If one of your creditors is the ATO (for unpaid taxes), then your tax refund will likely be taken by the ATO while you are bankrupt to contribute toward your tax bill. If you don't have a tax bill then you will keep your tax refund provided that doesn't take you over your threshold income limitations.

If you feel like when it comes to Bankruptcy, your issue is more challenging, then simply get qualified advice in Sydney. I may sound like a broken record, but remember that it's always a great idea to work through these options prior to declaring bankruptcy, since once you have filed the paperwork it's far too late to change your mind.

If you want to learn more about what to do, where to turn and what issues to ask about Bankruptcy, then feel free to contact Fresh Start Solutions Sydney on 1300 818 575, or visit our website:freshstartsolutions.com.au/bankruptcy-Sydney

Bankruptcy in Sydney - Choices, Choice, Choices

When it comes down to Bankruptcy Sydney, there are a bunch of choices that we get given depending upon who we are, who we speak with, and what exactly has happened. The most common confusion I see with Bankruptcy is when it comes to choosing between Debt Consolidation, Personal Insolvency Agreements, and Bankruptcy itself.

Should I consolidate my debts?

When it comes to Bankruptcy in Sydney, most of the information you receive on this issue will reflect the interests of the advice giver. That is why, if you call a debt consolidation provider, I can assure you they will tell you to consolidate your debts. The debt consolidation business is a multi-billion dollar industry making money in one very straightforward way: charging you a fee for aiding you wrap most of your credit card and personal loans into just one neat and tidy bundle.

I hate to tell you this but these guys won't be doing it free of charge. Please do not misunderstand me: if you believe your financial issues in Sydney may be solved by paying less interest, then go on and investigate the choices. Even a tiny amount of interest saved over years rapidly adds up.

More often than not I find if you read this blog you've most likely attempted to consolidate your debts already and come to the following realisations like these:

• Your credit rating is not good, and your credit file already has defaults on it so not a single person will offer you a loan, consolidated or otherwise,.

• By the time you work it all out, you're so far down a hole that saving a tiny bit of interest simply won't make a great deal of difference,.

• You've most probably gotten to the stage where you've had enough, you're emotionally worn down, you can't go on yet another day ignoring blocked calls on your phone, ignoring the demands in the mail and so forth.

Personal Insolvency Agreements

So when it comes down to Bankruptcy in Sydney, what's the difference between a Debt Agreement and a Personal Insolvency Agreement?

Overall flexibility is the main point Personal Insolvency Agreements (PIA) have in their favour. They're also administered by a registered and - might I add - regulated trustee including the government trustee ITSA, and not a private firm that advertises on TV. Ultimately this method is similar to Debt Agreements (DA): The trustee holds a meeting with the people you owe money to and these guys work out a deal on your behalf. You can offer a lump sum settlement figure or take part in a payment plan, or you can offer them assets as an alternative to cash. This can sound alright when it comes to the troubles with Bankruptcy - that is up until you realize that one of the difficulties with PIA's is that 75 % of the people you owe money to need to come to an understanding the deal. If they don't, your plan is denied or needs to be renegotiated.

Generally the people you owe money really want all their money back and also interest. Sometimes they'll opt for less than the amount you owe them - it's typically a percentage of the debt - but allow me to stress this part: because of all the variables involved in the negotiation process to put together a PIA its difficult to put a figure on what the people you owe money to will really settle for.

Most of the time you'll have to pay back 100 % of the debt owed. This is not because your creditors are greedy or have a mean streak, it's because the administrators take 20 % of whatever is decideded upon with the people you owe money to. That applies whether you use a private company for this process or ITSA, the government body setup to administer to these PIAs.

When it comes to Bankruptcy and insolvency I've come across creditors opting for less 80 % on rare occasions, but that usually only occurs with a public company entering into receivership owing huge sums of money (the kind that makes the news). If you are were owed $10million and you know the people who owe you the money have a team of shrewd lawyers and some very clever structures in place and they offer 5 % of the debt, you might take it and be grateful. Sadly, ordinary punters like you and me in Sydney aren't going to get that lucky!

If you want to find out more about what to do, where to turn and what questions to ask about Bankruptcy, then feel free to call Fresh Start Solutions Sydney on 1300 818 575, or visit our website:freshstartsolutions.com.au/bankruptcy-Sydney