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If reading this considerably after this date, please read through some of our various blog posts to validate the data is still up to date. Do you realise just how much Bankruptcy in Perth is going to be changing? The Australian Government by the end of 2015 formulated some radical proposals and possible modifications to the Bankruptcy Laws in Australia, specifically when it concerns the duration of bankruptcy. Right now, there is a minimal quantity of time that you must stay insolvent, having said that, this 3 year period may effectively be decreased to just 12 months. So if you are considering going bankrupt, these alterations are going to be quite critical to you! Exactly how did this all come to be? Well, Mark Carnegie (an expert in this field) commented back in December 2015 in the Financial Review that there was going to be recommendations for “the proposed changes to ease the burden of bankruptcy laws didn’t go far enough and the government should adopt US-style laws to protect the family home”. What trouble is he aiming to resolve? Currently, the laws don’t have enough protections, to the extent that Mr Carnegie, proceeded to say in the Financial Review that providing security to family assets was essential because “banks just terrorise small business and the mental health consequences to society are enormous”. The problem is Australia’s bankruptcy laws deterred investors from assisting start-ups, and therefore mentoring had been “driven out of the system” and lots of people are too troubled to try and invest or attempt to run a business. “They naturally find it very intimidating themselves personally and with their assets at risk in a risky early-stage deal, but with their own money in the deal and a lightened-up provision I think we’d probably see more willingness. It could be more important than the money”. This implies that right now, the existing legislations are costing the overall economy and they may work with you, but they could be manipulated and sometimes the innocent fall within the gaps and get unfairly punished. What is being proposed? The recommendation is to get the 3 year bankruptcy duration decreased to just 12 months when there is zero indication of fraudulence or unethical behaviour. These improvements will signify a lot for Bankruptcy and will likely take at least 18 months to implement. What is Fraudulent Behaviour? Fraudulent behaviour is basically a term that includes all of the bad things. So when it comes to Bankruptcy, this means that it will cover behaving dishonestly, hiding assets, taking careless risks, behaving unethically or just generally attempting to scam people. One proposed strategy is that whilst they are lowering the time for individuals acting truthfully, they could actually implement a counter proposal to pinpoint those acting significantly dishonestly and increase the amount of time. There are already some regulations in position for whenever you do not observe particular guidelines (and I recommend you to learn more about Bankruptcy to make sure you don’t inadvertently break these rules) but it will be interesting to observe exactly how this develops. So is this a Win for Small Business? Yes, absolutely! This is going to be excellent for small business and I really hope that you are reading these modifications to Bankruptcy and are getting as thrilled as I am. These proposed changes will be good for local businesses because it will motivate more people to get engaged and take estimated risks– There will nonetheless be consequences in place, but it won’t be unfairly penalizing those who make truly honest miscalculations. Most small business owners I assist with Bankruptcy, are hardworking, tax paying, companies that are trying to keep this nation going and so I am delighted to see what will be happening next with this, and how it will impact Bankruptcy. Bankruptcy helps save lives, and it can save yours. If you really require some support with your debts in Perth or are just considering Bankruptcy, don’t hesitate to call us here at Bankruptcy Experts Perth on 1300 795 575, or visit our website: Bankruptcy Perth