BANKRUPTCY

 

BANKRUPTCY

What’s changed?

Changes take effect from
25 March 2020 and expire on 25 September 2020.

This page last updated on 27/04/20

  • The minimum amount to apply for a bankruptcy notice (forced bankruptcy) has been increased from $5,000 to $20,000.

  • The time for a debtor to respond to a bankruptcy notice has been extended from 21 days to six months.

  • Temporary Debt Protection (the re-named Declaration of Intent process) will be extended from 21 days to six months.

  • COVID-19 supplement payments may be claimable in bankruptcy by the Trustee if paid before bankruptcy and they remain in a person’s account after becoming bankrupt.

  • Economic support payments are not claimable at any time. 

BANKRUPTCY

What’s changed?

Changes take effect from
25 March 2020 and expire on 25 September 2020.

This page last updated on 27/04/20

  • The minimum amount to apply for a bankruptcy notice (forced bankruptcy) has been increased from $5,000 to $20,000.

  • The time for a debtor to respond to a bankruptcy notice has been extended from 21 days to six months.

  • Temporary Debt Protection (the re-named Declaration of Intent process) will be extended from 21 days to six months.

  • COVID-19 supplement payments may be claimable in bankruptcy by the Trustee if paid before bankruptcy and they remain in a person’s account after becoming bankrupt.

  • Economic support payments are not claimable at any time. 

BANKRUPTCY

What’s changed?

Changes take effect from
25 March 2020 and expire on 31 December 2020.

This page last updated on 11/09/2020

  • The threshold for the minimum amount of debt required for a creditor to apply for a bankruptcy notice (forced bankruptcy) has been increased from $5,000 to $20,000.

  • The time a debtor has to respond to a bankruptcy notice has been extended from 21 days to six months.

  • Temporary Debt Protection (the re-named Declaration of Intent process) period of protection has also been extended from 21 days to six months.

  • COVID-19 supplement payments may be claimable in bankruptcy by the Trustee if paid before bankruptcy and they remain in a person’s account after becoming bankrupt.

  • Economic Support Payments are not claimable at any time. 

 

TEMPORARY DEBT PROTECTION

What’s changed?

Temporary Debt Protection (previously called a Declaration of Intention to present a Debtor’s Petition) will be extended from 21 days to six months.

This page last updated on 11/09/2020

Originally scheduled to end late September, the Government has announced and will update the Bankruptcy Regulations to extend the changes to Temporary Debt Protections (TDP) until 31 December 2020.
 

Some people in financial difficulty may consider six months of protection attractive.  It is important to consider other options as the protections provided for TDP are very limited.

Disclaimer: The information on this website is for financial counsellors only. It is general information only. Financial counsellors must still tailor advice to their client’s individual circumstances. 

Copyright © 2020 Financial Counselling Australia. All rights reserved.​

FCA sincerely thanks Kat Lane. Liz Minter and Melinda Rene for their outstanding work in putting this site together.

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