New insolvency rules commence

New Insolvency Rules Commence

 

The measures from 1st January 2021 apply to incorporated companies with liabilities less than $1 million.

 

       

For those businesses that are “unable to survive”, a new simplified “liquidation pathway” will apply for small businesses to allow faster and lower-cost liquidation.

To be eligible to access this new process a company must:

  • have total liabilities which do not exceed $1 million on the day the company enters the process – this excludes employee entitlements;
     
  • appoint a small business restructuring practitioner to oversee the restructuring process, including working with the business to develop a debt restructuring plan and restructuring proposal statement.

This principle has the potential to allow continuation of a longer-term successful business hit by short-term or covid cash flow difficulties.

 

 

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Coutts Redington
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First and foremost, we’re accountants. But we like to think of ourselves as a lot more. We work closely alongside business owners to bring more clarity, direction, and support, improving elements of your life beyond just the business. And, with our firm’s history in the Townsville area going back to the 1950s, we’re an established part of the local business community. We take that responsibility seriously.

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