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DISCHARGE
DISCHARGE
HOW AND WHEN DOES MY BANKRUPTCY END?
Reproduced by express permission form the Commonwealth Government, Insolvency
and Trustee Services Australia.
June 2004 Edition
What is discharge?
Discharge is the end of bankruptcy.
When will I be discharged from bankruptcy?
Discharge from bankruptcy normally happens automatically 3 years and 1 day
after your Statement of Affairs was lodged with and accepted by ITSA.
If you have been made bankrupt by the Court your Statement of Affairs was
probably lodged some time after the date of bankruptcy.
There is no need to apply for discharge and there is no fee. You can get
written confirmation of your discharge from bankruptcy by:
- asking your trustee
- searching the public record (the National Personal
Insolvency Index or NPII database).
More information is available in the pamphlet: Searching the Public
Record
In some circumstances, you can be bankrupt for longer than 3 years for
reasons discussed later in this pamphlet.
What happens after discharge?
Your name will appear on the NPII forever.
The administration of your bankruptcy by your trustee may continue after you
are discharged. Your trustee may not have finalized investigations or the sale
of assets, or you may still have income contributions to pay.
What are my legal obligations after discharge?
- You must assist your trustee to finalise the administration
of your bankruptcy.
- You must advise your trustee of changes in your address or
financial circumstances if requested to do so.
- You must pay outstanding income contributions.
- Assets in your bankruptcy which have not been sold by your
trustee before the date of your discharge are not automatically returned to
you.
- In limited circumstances, your trustee has a time limit of
6 years after your discharge to deal with assets (other than cash).
More information is available in the pamphlet: Assets: What happens
to my assets if I go bankrupt?
Your trustee is the person who administers your bankruptcy or Part X
agreement; either a registered trustee or ITSA.
See the Prescribed Information booklet for definitions of other bankruptcy
terms
What happens to my debts after I am discharged?
You are released from certain debts when you are discharged from bankruptcy.
However, there may be some debts that you will still have to pay.
Debts you still have to pay during and after bankruptcy
1. Some debts are not provable in bankruptcy. Creditors with these types of
debt cannot receive any money from your bankrupt estate but they can continue
debt recovery action against you even during bankruptcy eg:
- penalties and fines imposed by a court
- damages from accidents (eg car accidents) unless, before
bankruptcy, the sum of damages has been fixed by a court judgment or you have
a written agreement with the other party
- student assistance/supplement loans.
2. Assets that you wish to keep but which are secured to a creditor (eg house
mortgage). You will need to keep paying for these assets or the creditor will
take them back.
More information is available in the pamphlet: Assets: What happens
to my assets if I go bankrupt?
3. Any new debts created on or after your date of bankruptcy.
Debts you still have to pay after your discharge
Creditors of certain types of debt (provable debts) can receive money from
your bankrupt estate and can also continue debt recovery action against you
after you are discharged from bankruptcy eg:
- child support debts
- maintenance
- accumulated HECS (Higher Education Contribution Scheme)
debts owing when you became bankrupt, excluding any amount shown on a notice
of assessment issued by the Australian Tax Office (ATO) before you became
bankrupt – ask the ATO if you need more information
- debts incurred by fraud.
More information is available in the pamphlet: Debts and Creditors:
What happens to them if I go bankrupt
Released from debt – you are no longer liable for or have to pay
this debt
Provable debt – an amount for which a creditor is entitled to claim
a dividend in your bankruptcy
Can I be discharged in less than 3 years?
No. However, in some circumstances, you may be able to have your bankruptcy
annulled (cancelled).
A bankruptcy can be annulled in three ways:
1. Payment in full – your creditors and your trustee’s fees and
expenses have been paid in full. This usually happens because your trustee has
sold assets and/or you have paid money ot your trustee from your income or
another source.
2. Composition or arrangement – creditors accept an offer made by you
through a trustee for finalizing your debts. This usually arises when a friend
or family member helps by offering a lump sum to your creditors. The offer must
also provide for payment of your trustee’s fees.
3. Application to the Court – in some limited circumstances, you may
apply to the Federal Court or Federal Magistrates Service to have your
bankruptcy annulled if you think you should not have been made bankrupt or
should not have lodged your Debtor’s Petition. You should seek legal advice
before making such an application.
More information is available in the pamphlet: Annulment: Can my
bankruptcy be cancelled?
Can I be bankrupt for more than 3 years?
The period of your bankruptcy may be extended to 5 or 8 years if your trustee
lodges an objection to your discharge with ITSA.
Your trustee may lodge an objection on a number of grounds, such as your
failure to:
- provide information to, and assist, your trustee
- disclose to your trustee all income
- pay assessed income contributions
- explain how money was spent
- reveal all assets and creditors.
You may request a review of an objection.
More information is available in the pamphlet: Can I Appeal? Review
and appeal of trustee and administrator decisions
Where to contact us
Telephone 1300 364 785
ITSA website wwwitsa.gov.au
ITSA Offices
ACT
Level 2, NFF House, 14-16 Brisbane Avenue BARTON ACT 2600
Tel: 1300 364 785
Fax: (02) 6270 3608
email: itsa.canberra@itsa.gov.au
New South Wales
GPO Box 548 SYDNEY NSW 2001 Level 8, 135 King Street SYDNEY NSW 2000
Tel: 1300 364 785
Fax: (02) 8233 7891
email: itsa.sydney@itsa.gov.au
Queensland
Brisbane
PO Box 10443 Adelaide Street BRISBANE QLD 4001
Level 16, 340 Adelaide Street BRISBANE OLD 4000
Tel: 1300 364 785
Fax: (07) 3360 5466
email: itsa.brisbane@itsa.gov.au
Townsville
PO Box 1527 TOWNSVILLE QLD 4810 Level 1,
National Australia Bank Building 315 Ross River Road AITKENVALE OLD 4814
Tel: 1300 364 785
Fax: (07) 4727 0500
email: itsa.townsviIIe-0itsa.gov.au
South Australia/Northern Territory
GPO Box 2604 ADELAIDE SA 5001
Level 18, Grenfell Centre 25 Grenfell Street ADELAIDE SA 5000
Tel: 1300 364 785
Fax: (08) 8112 4305
email: itsa.adelaide@itsa.gov.au
Tasmania
GPO Box 850 HOBART TAS 7001
Level 4, ANZ Centre 22-26 Elizabeth Street HOBART TAS 7000
Tel: 1300 364 785
Fax: (03) 6221 7700
email: itsa.hobart@itsa.gov.au
Victoria
Level 10, Melbourne Central 360 Elizabeth Street MELBOURNE VIC 3000
Tel: 1300 364 785
Fax: (03) 9272 4900
email: itsa.melbourne@itsa.gov.au
Western Australia
GPO Box H536 PERTH WA 6841
Level 12, Durack Centre 263 Adelaide Terrace PERTH WA 6000
Tel: 1300 364 785
Fax: (08) 9268 1298
email: itsa.perth@itsa.gov.au
More information pamphlets are available.
See the website or contact ITSA for a complete list.
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