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

Bankruptcy Toowoomba is a confusing process, and you have to ensure you get the right advice. And when it comes to your income being affected, the answer to the question is maybe. The very first thing you have to know about going bankrupt is there is no rule on how much you can earn. However, I will say that your income is a significant consideration when working through when it comes to Bankruptcy.

The first thing you need to keep in mind about this area of Bankruptcy is the amount 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 amount you earn per year. A dependant is someone who lives with you and earns less than $3,124 per year (regardless of their age).

You can get a hardship variation that raises the threshold amount, if you have costs in Toowoomba like medical, child care, major travel to and from your job, or a scenario where your partner used to work but is not able to contribute to the household income.

Some of the informative parts of Bankruptcy is that your employer will not be notified when you file for bankruptcy. Also, Child support is always looked at in bankruptcy, if you receive child support that is not factored in as income. If you pay child support this will be also thought about, for example if you pay $5,000 child support each year and you have no dependents living with you then your revised net income limit will be $55,332.10.

There are much more issues involving income and what is or isn't thought of as income - if you're unsure, it's ideal to get specialist advice. The reason you should consider your income as a part of the Big 5 questions here is that bankruptcy is in some situations not an economically sensible option.

If one of your creditors is the ATO (for unpaid taxes), then your tax refund will likely be taken by the ATO while 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 as long as that doesn't take you over your threshold income restrictions.

If you believe that when it comes to Bankruptcy, your situation is more complex, then just get experienced advice in Toowoomba. I may seem like a broken record, but keep in mind that it's always a great idea to overcome these options before declaring bankruptcy, due to the fact that once you have filed the paperwork it's too late to change your mind.

If you want to learn more about what to do, where to turn and what questions to ask about Bankruptcy, then feel free to contact Bankruptcy Experts Toowoomba on 1300 795 575, or check out our website: bankruptcyexpertsToowoomba.com.au.

Bankruptcy in Toowoomba - Choices, Choice, Choices

When it comes down to Bankruptcy Toowoomba, there are a lot of options that we get given depending upon who we are, who we speak to, and exactly what has gone wrong. One of the most common trouble I see with Bankruptcy is when it comes to choosing between Debt Consolidation, Personal Insolvency Agreements, and Bankruptcy itself.

Should I consolidate my debts?

When it comes to Bankruptcy in Toowoomba, much of the information you receive on this issue will reflect the interests of the advice giver. That is why, if you call a debt consolidation provider, I can promise you they will tell you to consolidate your debts. The debt consolidation business is a multi-billion dollar industry making money in one very simple way: charging you a fee for aiding 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 don't misunderstand me: if you feel your financial problems in Toowoomba might be solved by paying less interest, then go on and check out the options. Even a small amount of interest saved over years quickly adds up.

More often than not I find if you read this blog you've most likely tried to consolidate your debts already and come to the following realisations such as these:

• Your credit rating is not good, and your credit file already has nonpayments on it so nobody will give you a loan, consolidated or otherwise,.

• By the time you work all of it out, you're so far down a hole that saving a bit of interest simply won't make a lot of difference,.

• You've very likely reached the point where you've had more than enough, you're mentally drained, you can't go on another day ignoring blocked calls on your phone, ignoring the demands in the mail and so on.

Personal Insolvency Agreements

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

Adaptability is the main point 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 company that advertises on TV. Essentially this process resembles Debt Agreements (DA): The trustee has a meeting with the people you owe money to and these guys arrange a deal on your behalf. You can offer a lump sum settlement figure or enter into a payment plan, or maybe you can offer them assets rather than cash. This can sound alright when it comes to the troubles with Bankruptcy - that is up until you discover that one of the difficulties with PIA's is that 75 % of the people you owe money to will need to come to an understanding the deal. If they don't, your proposal is rejected or needs to be renegotiated.

Generally people you owe money want all their money back in addition to interest. Sometimes they'll opt for less than the amount you owe them - it's normally a percentage of the debt - but let me 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 truly settle for.

Most of the time 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 decideded 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 come across 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 structures in place and they offer 5 % of the debt, you might take it and be grateful. Sadly, ordinary punters like you and me in Toowoomba 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 call Bankruptcy Experts Toowoomba on 1300 795 575, or visit our website:bankruptcyexpertsToowoomba.com.au.