How long am I to be declared a bankrupt?

The term of bankruptcy generally lasts for a period of 3 years. However, under certain circumstances, the term can be extended.

For example:

1. If a bankrupt fails to follow their trustee’s directions, or obtains credit of more than $5.000.00 without disclosing the bankruptcy, the term of bankruptcy can be extended to 5 years.
2. In more serious cases, when the bankrupt intentionally tries to deceive their trustee or act with the intention to defraud their creditors the period of bankruptcy can be extended to 8 years.

The message is clear – a bankrupt must act honestly and openly with his or her trustee or risk extension of time in bankruptcy.

For further advice regarding the term of bankruptcy, please contact our Business & Commercial Team.

Further reading

Health Check for Business Owners

Back to Basics on Business Ownership Structures

Preparing your Business for Sale

Bankruptcy and Business Management

The importance of business records in managing debt

elringtons lawyers regularly provide legal advice in relation to a range of commercial matters. Please contact our Business & Commercial Team for more information or to make an appointment call (02) 6206 1300