In 2016-17 financial year, 30,161 people used the Bankruptcy Act 1996 to seek relief from debts. 16,518 of these resulted in bankruptcies. 30% of these cases were in Queensland, and 19% of these cases were the result of carrying on a business.
Personal insolvency can be created through business dealings such a providing personal guarantees to suppliers (i.e. creditors) from people who own companies, are sole traders or through their position within a business as a 'director'.
Corporate insolvencies for the 2016-17 financial year totalled 11,296 and again, Queensland was strongly represented at 21%.
Some reasons for insolvency from business include economic conditions, ill health of key business people, excessive drawings, failure to provide for taxation, excessive interest payments on loan monies, lack of sufficient working capital and inability to collect debts.
There are many ways you can protect yourself from insolvency, including:
Most small businesses operate an accounting software file, but few use it to it's full potential. These software systems offer many reports and tool which you can use to assess how your business is running. We offer a range of services in all accounting software including full training.
Need a lesson on how to get the most out of your file? Book in with us.
Failure to plan is planning to fail. Many small businesses are guilty of operating on a "see what's in the bank" or "assume it will be the same as usual" model instead of developing a business budget. Budgeting is one of the most important tools in managing your business resources.
We can help you set up, track and stick to your business budget.
If your business is dependent on one person (as most small businesses are) then it's essential that that person is adequately insured. We can work with you and a financial planner to be sure that your insurance needs are properly met.
Having trouble getting paid? Talk to us! We can help you improve your billing procedures and train you to follow up on your debts with regularity and consistency.
"When I was working in Australia I had no idea what I was doing when it came to my taxes or finance, Brock and his team helped me so much, after a while i understood what I needed to do and they even did it for me, they explained everything in a no nonsense manner." David Dixon-Angélil
Phone: 1300 427 526
Address: 15 Melway Crescent
HARRISTOWN QLD 4350,
Look out! The ATO may have you in their sights.
The ATO is on the hunt for people getting their work-related expenses wrong this 2018 tax time.