The number of businesses declaring bankruptcy within the last quarter has increased by over 14.8% to over 1,132 businesses. It is a little known fact about bankruptcy, that depending on how the business has been set-up, the Director will be held personally liable for the businesses debts. —
A number of owners find themselves in bad shape financially when their company does fold, and this leads to the stories we commonly hear about a business owner losing everything when their company goes belly up.
A commonly unreported impact of declaring bankruptcy is that the bankrupt is unable to be a company director for a number of years.
With many former directors wanting to set-up new businesses and start again they encounter this issues where they suddenly find they are unable to manage a new company and are often left in a situation where they are unable to earn an income at all, and are therefore left in a far worse situation then when they started.
The Federal Government is also very quick to crack down on any companies that appoint 'dummy' directors, especially when it is clear the disqualified director is calling all the shots, this can force significant fines for both the company and the individuals.
There are a wide range of options open to businesses owners who find themselves in this situation, that will not affect their career for a long period of time.
A large number of these options will require paying off creditors a portion of the debt, sometimes with reduced interest charges.
With an increase in the number of businesses declaring bankruptcy it is important all business owners are fully aware of the impacts of declaring bankruptcy may have on their personal lives.
Debt Cutter is one of Australia's leading personal debt management specialists. They are dedicated to assisting individuals to get out of debt and living their life free from financial stress.
8 December 2015
Media Contact: Elise Bentley +61 452 270 742
For interviews: Kyra Pritchard +61 402 117 252
For further information please visit: www.debtcutter.com.au.
Release ID: 98304