Jones Partner

Trading Places – Does It Really Work When a Company is Insolvent?

16/08/2016 by Bruce Gleeson

A talking point that I find is often raised by a director when their company is in financial difficulty and liquidation may be imminent is whether they should change directors. Let me be clear in explaining that the reason the current director is contemplating putting in their spouse or finding someone else as a director (both of whom may know very little about the business or importantly the financial position of the company) is about self preservation.Whilst it is not an unreasonable question to be posed, it is one that I find typically carries with it a lot of mis-information around the supposed benefits. Indeed, the 80’s movie (if you’re that old!!) called “Trading Places” springs

Read More 0comments

Happy 50th Birthday – Bankruptcy Act

25/07/2016 by Bruce Gleeson

The month of July 2016 marks the 50th birthday since the Bankruptcy Act 1966 commenced. Much has happened over that period in terms of changes to Australia’s bankruptcy laws and whilst the writer was not even thought about when the Bankruptcy Act first commenced, in my time as an Insolvency Practitioner I have seen a few key trends / changes over the last 25 years: Personal Insolvency Agreements or PTX’s whilst being more frequently used options in the 90’s to deal with a debtor’s financial position have continued to be in steady decline since the 00’s and presently are few and far between. The more readily used option these days (circumstances permitting) seems to be a Sec

Read More 0comments

Drive Thru Bankruptcies – Coming Soon to Australia

12/07/2016 by Bruce Gleeson

I hope this headline has got your interest! Yes Drive Thru Bankruptcies or more correctly put 1 year bankruptcy terms were announced as part of the (1) Productivity Commission’s Report to the Federal Government on 7 December 2015 that looked at key drivers of business set-ups, transfers and closures. This proposal and other changes were reforms announced as part of the National Science and Innovation Agenda by the Prime Minister and then the subject of a (2) Proposal Paper in April 2016. It has been expressed that Australia’s bankruptcy laws are overly punitive (when compared to other overseas jurisdictions) and that by reducing the current bankruptcy term from 3 years to 1 year that th

Read More 0comments

To Credit Repair or Not? Time for Regulation!

08/02/2016 by Bruce Gleeson

A Report commissioned and released by ASIC’s Consumer Advisory Panel (“CAP”) in January 2016 titled “Paying to get out of debt or clear your record: the promise of debt management firms” makes a number of key findings/observations. Specifically, the Report labels firms that promise to help consumers (or individuals) in financial hardship or with listings of payment defaults on their credit reports as “debt management firms”. Typically these firms promise to help individuals by: – developing & maintaining budgets; – negotiating with creditors or debt collectors; – advising and arranging formal debt agreements under Part IV of the Bankruptcy Act 1966 [known as debt a

Read More 0comments

SMEs – Are You Aiming to Thrive or Aiming to Survive! Key Challenges

22/11/2015 by Bruce Gleeson

As we approach the end of 2015 and SME owners hopefully take some time away from the day to day grind (yes please), attached below is an article that I wrote for the BiziNet Magazine November / December 2015 edition. SME owners should ask themselves as they reflect on the current year and importantly think about 2016 and beyond what their aim is! As my article explains, those that aim to thrive and have a dedicated plan (and resources) to do so are more likely to succeed than those that simply aim to survive. There are many reasons for this, but importantly it reflects on attitude.–online–journal/2015/11/06/smes-are-you-aiming-to-thrive-or-aiming-to-survi

Read More 0comments

Bankruptcy and the Family Home Part 2 – The Doctrine of Exoneration

29/05/2015 by Bruce Gleeson

In the February 2015 newsletter I wrote about bankruptcy and the family home and typically what happens when an individual enters into bankruptcy and has an ownership interest in the family home. In such situations, it is a very emotional and real practical consideration when contemplating voluntary bankruptcy. This follow on article considers the position of the co-owner (i.e. the spouse in most instances) and aspects they should consider when taking into account what offer they may put forward (if any) to the bankruptcy trustee regarding the bankrupt’s interest in the family home. I typically find as a Bankruptcy Trustee that the Doctrine of Exoneration is a concept that can be quite

Read More 0comments

BEWARE: ATO flags tougher stance on small business tax debt

25/05/2015 by Bruce Gleeson

Recent media coverage about the ATO tougher stance on small business tax debt [Daniel Meers from Herald-Sun on 21 May 2015] should serve as a timely reminder to company directors (owners) that find themselves unable to pay GST / PAYG or SGC to get the right professional advice, rather than ignoring the problem with the hope that they will be able to deal with it later. The recent article titled “No More Mr Nice Tax Guy” was also published in the Daily Telegraph. The article in short indicated that the ATO has begun a crackdown on unpaid small business tax debt. This should come as no surprise as it tends to be these types of companies (ie mainly family businesses) that more frequently

Read More 0comments

Bankruptcy – gambling, excessive use of credit cards and blowing proceeds from sale of property – a dangerous cocktail!!

19/05/2015 by Bruce Gleeson

A recent Media Release by AFSA see link highlights the addiction of gambling and additionally that if forced into bankruptcy as a result of such gambling, then, in certain circumstances the individual may have committed an offence under Section 271 of the Bankruptcy Act. In this case, the individual went into bankruptcy voluntarily owing her creditors almost $440,000 using 22 credit cards. In the 12 months prior to her bankruptcy she sold property owned by her and claims to have blown almost $100,000 on gambling. The individual was found guilty and pla

Read More 0comments

Reinventing the ATO – More Insolvencies & Bankruptcies Possible!

24/03/2015 by Bruce Gleeson

Tax Commissioner Mr Chris Jordan has said in a speech to the Tax Institute on 19 March 2015 that the Australian Taxation Office (“ATO”) is bringing forward the point at which it takes legal action to recover debts from both individuals and companies. Is this a good thing or bad news? As a Registered Liquidator and Registered Bankruptcy Trustee, I see too often the impact of when family business owners (or SMEs) and individuals don’t treat the ATO with the same priority as other creditors. Left unresolved it typically means the forced liquidation of a company or bankruptcy of the individual. Consequently, I believe the recent announcement is a good thing for a couple of main reasons:

Read More 0comments

Unemployment and Credit Card Debts – The Major Causes of Bankruptcy in 2014

17/03/2015 by Bruce Gleeson

Recent statistics issued by the Australian Financial Security Authority (“AFSA”) reveal that for the 2013/14 financial year unemployment/loss of income (8,418) and excessive use of credit card facilities (6,999) were the top 2 causes of personal insolvency. These causes have remained relatively stable since 2007/08 and are not necessarily a huge surprise. Whilst not overly unexpected, in my experience as a Bankruptcy Trustee it does illustrate what I find commonly happens and should serve as a timely reminder for individuals who may find themselves in a position where their employment has been terminated. When there is a loss of employment, it is not uncommon after the termination paym

Read More 0comments