When people in
Sunshine Coast come to me trying to talk about Bankruptcy, they are typically
loaded with questions. The internet is full of information, but far too much of
it is baffling or contradicts itself, so I make it my mission to try and make
it clearer. One of the most typical worries is 'Will I lose my business if I
declare bankruptcy?' The short answer is no. If you are an owner of a business
any shape or size you can maintain your business if you would like to. In
Sunshine Coast, businesses that become insolvent have a few options like
liquidation, voluntary administration and so on. It's individuals who go
bankrupt not businesses.
Bankruptcy is a
complex area so get some reliable advice on this one if you have a business.
Generally speaking, the debts in a business and personal debts go hand in hand
when a business owner declares bankruptcy. There are a few significant
implications for directors of companies when it comes to Bankruptcy in Sunshine
Coast: A bankrupt can not be a director of a company, so if you have a pty ltd
company you will likely need to resign as a director once you're bankrupt.
A constraint
that applies when you are bankrupt as a business owner is that you may be in
your own business as a sole trader only. Certainly there are things you need to
reveal as an aspect of that but basically you can still run your company. For
some business owners, bankruptcy affects their ability to run the business
because of the licensing issues. For instance, if you run a building company,
your license will be suspended once you're bankrupt and as a consequence you
can not trade without that license, so make sure you are asking the best
questions when it comes to licenses and Bankruptcy in Sunshine Coast.
However if your
business is not impacted directly by such issues, then you'll have to
restructure the way you run your business. There are considerations when and if
you go bankrupt as a business owner: you can not acquire heaps of debt in your
company, then go bankrupt and after that open the doors the next day like not a
thing had happened. There are laws in place to prevent what is called phoenix
companies appearing out of the ashes of an old business.
Having said
that, it's just a point of speaking with the right people about Bankruptcy. In
this situation you may think you need a liquidator for your business, and you
may be right, but keep in mind that every liquidator is different and have
their own motives. Liquidators profit from your liquidation - heaps of money -
so exactly what advice do you believe you will get?
When it comes to
Bankruptcy, I consider that giving generic advice in this area is likely unsafe
as it can have very substantial implications for directors and business owners.
This is because it is just one of those cases where what the right guidance for
one business owner is the incorrect advice for the other. There are some
principles however, that you may benefit from. There is no reduce to the size of
the business you run though you are bankrupt. You can employ staff. You can
continue to deal with your distributors under certain conditions, the main one
being you will need to meet the payment terms agreed upon.
So when it comes
to Bankruptcy, don't get overly uneasy about what you can and can't do as a
business owner, just get the appropriate advice ... If you need to learn more
about what to do, exactly where to turn and what questions to ask about Bankruptcy,
then feel free to get in touch with Bankruptcy Advice Sunshine Coast on 1300
879 867, or visit our website: www.bankruptcy-advice.com.au/Sunshine Coast .
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