Bankruptcy in Darwin - Will my income be altered if I go bankrupt?

Bankruptcy Darwin is a intricate process, and you ought to ensure you get the right guidance. 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 constraint on how much you can earn. However, I will mention that your income is a major consideration when working through when it comes to Bankruptcy.

The first thing you need to keep in mind about this area of Bankruptcy is just how much 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 sum 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 make an application for a hardship variation that increases the threshold amount, if you have financial commitments in Darwin such as medical, child care, serious travel to and from work, or a scenario where your partner used to work but is not able to support the family income.

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

There are many more issues surrounding income and what is or isn't considered income - if you're unsure, it's recommended to get professional advice. The reason you need 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 be taken by the ATO whilst you are bankrupt to chip in 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 caps.

If you feel like when it comes to Bankruptcy, your case is more complicated, then simply get specialist advice in Darwin. I may seem like a broken record, but keep in mind that it's always a good idea to work through these options prior to declaring bankruptcy, because once you have filed the paperwork it's far too late to change your mind.

If you would like to learn more about what to do, where to turn and what questions to ask about Bankruptcy, then don't hesitate to contact Fresh Start Solutions Darwin on 1300 818 575, or check out our website: www.freshstartsolutions.com.au/bankruptcy-Darwin

Bankruptcy in Darwin - Choices, Choice, Choices

When it comes to Bankruptcy Darwin, there are a bunch of options that we get given depending upon who we are, who we speak to, and exactly what has gone wrong. Among the most common confusion I see with Bankruptcy is when it comes to selecting between Debt Consolidation, Personal Insolvency Agreements, and Bankruptcy itself.

Should I consolidate my debts?

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

I hate to tell you this but they aren't doing it free of charge. Please do not misunderstand me: if you believe your financial troubles in Darwin may possibly be fixed by paying less interest, then go ahead and look into the choices. Even a small amount of interest saved over years easily adds up.

More often than not I find if you read this blog you've undoubtedly 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 nonpayments on it so no one will give you a loan, consolidated or otherwise,.
• By the time you work it all out, you're so far down a hole that saving a little bit of interest just won't make a great deal of difference,.
• -You've most probably arrived at 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 on.

Personal Insolvency Agreements

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

Flexibility is the main thing Personal Insolvency Agreements (PIA) have in their favour. They're also administered by a registered and - may I add - regulated trustee featuring the government trustee ITSA, and not a private firm that advertises on TV. Ultimately this process is similar to Debt Agreements (DA): The trustee has a meeting with the people you owe money to and they work out a deal in your place. You can give a lump sum settlement figure or take part in a payment plan, or maybe you can offer them assets instead of cash. This might sound okay when it comes to the problems with Bankruptcy - that is up until you realize that one of the problems with PIA's is that 75 % of the people you owe money to must come to an understanding the deal. If they don't, your plan is rejected or ought to be renegotiated.

Generally people you owe money want all their money back plus interest. Sometimes they'll settle for under the amount you owe them - it's normally a percentage of the debt - but allow me to stress this aspect: 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 in fact settle for.

In most cases 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 agreed 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 heard of creditors choosing 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 smart lawyers and some very clever frameworks in place and they offer 5 % of the debt, you might take it and be grateful. Sadly, ordinary punters like you and me in Darwin aren't going to get that lucky!

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