During bankruptcy, your trustee may be able to claim, and sell, some of your possessions (assets). Your trustee can use proceeds from the sale of your assets to repay money you owe to creditors. Assets may include, but are not limited to, real estate, vehicles, bank balances, tools, lottery winnings. You must declare any assets you have when you apply for, and any you receive during, bankruptcy. There are penalties for not disclosing information to your trustee. Below is information about what your trustee can and cannot claim.
Your vehicle You can keep a vehicle/s you use mainly for transport up to a set amount. Once the value of your vehicle/s exceeds this amount your trustee may claim them. Amounts can be found at https://www.afsa.gov.au/insolvency/how-we-can-help/indexed-amounts-0
Your house and property you own Your trustee can claim any house/s or property you own as an asset.
>Money you receive during bankruptcy This is money that doesn't form part of your ordinary income. It can include superannuation, inheritance money, gifts of money and compensation payments. Certain types of payments may be protected meaning the trustee can't claim them. Any prizes or lottery winnings you receive during bankruptcy are an asset that your trustee can claim. If you purchase assets (e.g. a house) using protected money, your trustee may not be able to claim this. For example, if you use 100% protected money to purchase the house, your trustee is unable to claim this. If you purchase a house using only a portion of protected money (e.g. 20%), the trustee may seek to claim 80% of the house. The trustee would then refund you the protected portion (e.g. 20%).
Tools of trade These are tools you use to earn a living. You can keep these tools as long as the value is below a set amount. To work out their value, use the current market value (what you'd get if you sold them today). Not the price you paid for them. If they are above the set amount your trustee is able to sell them to help pay your debts. Amounts can be found at https://www.afsa.gov.au/insolvency/how-we-can-help/indexed-amounts-0
Once bankrupt you will no longer need to pay most of your debts. Now you can work on your future. During bankruptcy you have certain obligations and may face some restrictions. It is your obligation to tell your trustee when your circumstances change. You must inform your trustee if you:
You also have the following responsibilities. You must:
There may be penalties if you don't comply with the above obligations and restrictions. In some cases, your trustee may extend your bankruptcy.
During bankruptcy, you must stay in contact with your trustee and inform them when your circumstances change. You must tell your trustee if you change your:
Objections to discharge may extend your bankruptcy. Possible reasons for an Objection to Discharge include if the bankrupt:
Yes. The most important are listed below:
The penalties for these offences vary from 6 months to 3 years imprisonment upon conviction.