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Liquidation and Insolvency Advice

Yesterday I consulted to an accountant and his client who called at about 7.30pm.

There was no appointment for the call however the accountant was aware that The Insolvency Experts provide free, 24 hour insolvency advice and that calls are always answered by a Registered Liquidator or Senior Manager in the organization who is able to give expert advice on the spot.

The caller operated a recruitment company with a small ATO tax debt comprising unpaid PAYG and GST. The company had also been notified of a claim from the Office of State Revenue in relation to payroll tax.

The director had recently ceased trading the business and was finding the whole matter incredibly stressful and this was leading to personal issues and sickness.

I explained to the director that the debts of a company are not the debts of the director/controller due to the separation of the director and the company – that is, a company is a separate legal entity as distinct from its owners/controllers.

Accordingly, the tax debts were debts of the company and not the director personally.

I then explained that there was a personal risk to the director insofar as the unpaid PAYG tax debt was concerned.

I explained to the director and his advisor that the ATO could issue a Director Penalty Notice to a director for unpaid PAYG tax and that if the DPN was not complied with in the 21 day period allowed under the notice, that the director would then be personally liable for the unpaid tax debt of the company.

The director advised that the unpaid PAYG tax amounted to $15,000 – $20,000 and on that basis, I advised him that as the costs of liquidating the company were substantially lower than the outstanding PAYG tax amount, it would be commercially sensible to liquidate the company. I also explained to the director that once the company was in liquidation, the ATO could no longer issue a DPN.

The director advised that there was a small amount of debtors or receivable accounts able to be collected and asked whether those funds if collected could be used to pay the costs of the winding up.

I explained to the director that a liquidator is actually paid from the assets of a company and that in circumstances where there are sufficient assets to cover the liquidators fee, a director would not be asked to pay any funds toward the cost of the liquidation process itself.

The director and his accountant were pleased with the advice and a package of information was prepared and sent to enable the company to be placed into Liquidation.

The Insolvency Experts are specialists in Liquidation, Voluntary Liquidation and Bankruptcy as we are Registered Liquidators, Official Liquidators and Bankruptcy Trustees

We are not unqualified middlemen trying to interpose themselves and be your guardian in insolvency situations for a fee when they are absolutely not required. Middlemen have no role in the Insolvency Process. A genuine lawyer or accountant – yes – but unqualified middlemen – absolutely not.

Whenever you seek insolvency advice, make sure you ask the person the following questions

• are you a Registered Liquidator?
• are you a Trustee in Bankruptcy?
• how are you qualified to provide your services?

The Insolvency Experts are available 24 hours each day by calling 1300 767 525. All calls are entirely free, confidential and if required, for any reason whatsoever, anonymous.

We look forward to being of service. Call 1300 767 525.

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