Bankruptcy in Sydney – Worried about what will happen to your business?
Amongst the biggest questions we get whenever it comes to Bankruptcy is if you will lose your business if you declare bankruptcy. The short answer is no, you are not likely to lose your small business except if you would like to.
When it relates to Bankruptcy, if you are a manager of a company any shape or size you can keep your business if you wish to, typically a failing business can push a person into insolvency, so because of those scenarios it might be better to allow the business go. In Sydney, businesses that become bankrupt have a couple of alternatives like liquidation, voluntary administration and so on. So bear in mind that it is people who declare bankruptcy not businesses.
Bankruptcy is a complicated aspect so obtain some specialist advice on this one, especially if you have a business. Generally speaking, the financial liabilities in a business and personal debts go together when a business owner declares bankruptcy.
Are you a company Director?
Certainly there are a few crucial implications for directors of companies when it concerns Bankruptcy in Sydney: if you are insolvent you can not be a director of a company – so this implies that if you have a pty ltd company you definitely will be required to retire as a director as soon as you’re bankrupt.
For some business owners, bankruptcy impacts their capacity to manage the business because of the licensing issues. For example,, if you operate a building business, your license will be suspended once you’re insolvent and as a consequence you can not trade without that license, so be sure you are asking the right inquiries when it comes to licenses and Bankruptcy in Sydney.
However if your business is not impacted directly by such concerns, then you’ll want to reorganize the way you operate your business. There are considerations when and if you go bankrupt as a local business owner: you can not attain loads of debt in your business, then go bankrupt and afterwards open the doors the following day as if not a single thing had happened. There are laws in place to prevent what is referred to as phoenix companies appearing out of the ashes of an old company.
Having said that, it’s just an issue of talking to the right people about Bankruptcy. As an example, amongst the most common beliefs is that you really need a liquidator. But most of the time you are going to be told of this from a liquidator who stands to earn a significant commission- so take care with exactly where you acquire suggestions from and be careful about other individuals who might have their own agendas.
An important thing to keep in mind with Bankruptcy is to be cautious of basic or simplistic approaches to your business and Bankruptcy because each business is going to be diverse, and if you are not vigilant there may be some huge implications. Commonly the right support for one entrepreneur is the incorrect suggestions for the other. There are some basics however, that you might benefit from. There is no mandatory reduction in the size of your business when you are insolvent. You can still recruit and hire new staff. And you can continue to deal with your distributors under certain situations, the main one being you will need to fulfill the payment terms agreed upon in light of your bankruptcy.
So when it comes to Bankruptcy, don’t get too confused about what you can and can’t do as a business owner, just get the recommendations that is right for your case. If you want to find out more about what to do, where to turn and what questions to ask about Bankruptcy, then feel free to speak with Bankruptcy Experts Sydney on 1300 795 575, or visit our website: www.bankruptcyexpertssydney.com.au.