Frequently Asked Questions

General Questions

Corporate Questions

Personal Questions

General

LemonAide represents you and discusses your unique situation in a holistic way. A Liquidator is unable to discuss with a Director their personal financial situation or how a Liquidation will affect the Director personally as they have a fiduciary obligation to the Company’s creditors. If a Liquidator did provide such personal advice to the Director they would be conflicted out of taking the role of Liquidator.

While a Bankruptcy Trustee is able to discuss some aspects of your personal financial situation, they are not able to discuss all aspects with you freely. LemonAide, however is able to discuss every aspect of your financial situation with you, freely.

Liquidation and Bankruptcy (Insolvency) are very difficult and specialised area to navigate on your own. As discussed above, a Liquidator or Bankruptcy Trustee can only give you minimal information that relates to your circumstance. LemonAide looks at your situation and offers advice on the alternatives available and how a Company Liquidation will affect you personally.

We hold your hand through every aspect of the Liquidation or Bankruptcy. YOU ARE OUR CLIENT!!! Remember the Liquidator does not represent you, they represent the creditors of the Company. Similarly, remember the Bankruptcy Trustee does not represent you, they represent the creditors of your Bankrupt Estate. 

Finally, we have over 15 years practical, hands on experience working for Liquidators and Bankruptcy Trustees. We are able to tell you practically how every aspect of a Liquidation or Bankruptcy will unfold. Rather than someone providing you theories of what could happen, we tell you straight all the options that could happen but also what is most likely to occur. This is the peace of mind that you really need.

In order to provide you the best advice we need to review your financial information to see what it is telling us. During our initial free zoom conference we will tell you what we have found, why and what document is providing that indication to us.

This also depends on you, the complexity of your situation, external factors that are occurring and what other services are needed. Why do I say you? Well, some clients employ LemonAide and then take a long time to get documents to us or implement the strategy, do not be like these clients!! 

On average it can take between 2 to 6 weeks of our direct time to work on a clients file. When other services are required, there are times when we are waiting for those services to be finalised. You do not get charged for these times by LemonAide but they can extend the timeframe of a file.

We have completed a corporate restructure in 1 week which did not require any external services (this time frame did not include the Liquidation). This client had sufficient funds to lend the working capital to the new entity. Even though it can be done, it is never recommended to leave things to the last minute.

Definitely not. Even if you have attended court or already appointed a Liquidator or Bankruptcy Trustee and things are not turning out how you thought they would, we can still make a world of difference to improve your situation.

Yes, we help individuals with personal debt every day of the week.

Absolutely, we help all different types of clients deal with their debt problems.

You can, however it is not advisable to do so as your creditors will continue to contact you to press for payment or may begin recovery proceedings against you.

Our costs are reflective of the complexity of your situation however, our rates are highly competitive.

LemonAide clients are generally feeling a range of emotions varying from angry due to their current predicament not solely being of their own making to despondent due to the Company being the only source of income for the family. Clients feel like they are going to lose all the assets that they have spent their life accumulating because they have heard all the horror stories associated with insolvency. Clients also feel like they have no one on their side and no one to talk to.

LemonAide was created to represent the interests of Directors and Individuals going through very challenging time in life. We said LIFE and not financial life because when things are not going well in their financial life it generally spills into other areas of their life, such as; relationships, family life, mental health etc.

We are on YOUR SIDE. We are here to listen to your unique story with empathy and compassion. We will give you guidance on your unique situation meaning all that you need to do is listen to the guidance and follow it so that your long-term future will improve.

In order to provide you with proper advice about your situation we will ask for the following information to be provided:

  • A company – balance sheet, creditors listing, profit and loss, bank reconciliations for a number of months, employee entitlements, bank statements, the ATO running balance account and anything else we think may help us provide you quality advice.

  • An individual – mortgage documents, loan documents, credit card statements, bank statements, creditor statements and anything else we think may help us provide you quality advice.

Basically, we want to provide you with quality actionable advice…but to do that we need to talk to you as well as see what the documents are telling us.

Corporate

A Liquidation is for companies. In Australia a company cannot go Bankrupt, that is only in the USA. An individual goes bankrupt.

We will look at whether the Company really needs to enter into Liquidation or if there are other options that could be utilised to avoid a Liquidation all together, we will always recommend these services first. 

We will look at the Company’s financial situation and the Director’s personal financial situation and make recommendations on actions that should be undertaken to either improve the Company’s situation to return to a profit or to minimise the effects of Liquidation on the Director, Employees or Creditors.

If Liquidation of a Company is recommended it is not necessarily the end of business but part of a bigger strategy to restructure the Company’s business. In any event, if Liquidation has been recommended, we will discuss with you how a Liquidation will affect the Director’s personal financial circumstances.

This is dependent upon one main factor and that is the Liquidator’s investigations. If a Liquidator’s investigations reveal many potential claims that they wish to pursue against various parties, then the Liquidation could be extended beyond a year.

We have seen Liquidation’s completed within 6 months, however this a rarity and not the norm.

Refer to the blog on Voidable transactions here.

On average it will cost around $13,000 to $15,000 to place a company into liquidation where the Company is insolvent.

There are advertisements for low cost liquidation. Refer to our blog here on why there is no such thing as a low cost liquidation.

Personal

A Bankruptcy in Australia lasts for 3 years and 1 day as long as you have complied with all of your obligations.

If you have outstanding obligations a Bankruptcy Trustee can object to your automatic discharge until either you have complied with the obligations or for a further 5 years. So, it really is in your best interest to comply with your obligations under a Bankruptcy.

Yes, all debts must be declared in a Bankruptcy. You are not able to only declare some debts as you want to pay them later. Bankruptcy is designed to help you by giving you a completely fresh start.  You may pay some creditors during your bankruptcy if you choose (you are under no legal obligation to do so), however their payment is from after tax and income contributions funds.

Depending on the number of dependents and the amount you earn after tax, you may have to pay your Trustee money through income contributions if you are above the threshold. For every $1 you are over the threshold, $0.50 will need to be paid to your Trustee. 

The public Trustee also known as the Official Trustee or the Australian Financial Security Authority (“AFSA”) allows people to go Bankrupt for free.

A private Trustee is a Bankruptcy Trustee that works for a private firm.

Both Trustees must operate by the same rules, however some people feel more comfortable knowing who they are dealing with on a day to day basis and thus employ the services of a private Trustee.

No, a bankruptcy is no longer advertised in the newspaper. The only people that will know of your Bankruptcy are creditors and credit providers if they do a Bankruptcy check on you. So unless you tell people that you are Bankrupt, no one really needs to know about it.

So, your credit report will have that you have been Bankrupt for a period of 2 years after your discharge. The National Personal Insolvency Index (“NPII”) also records that you went Bankrupt, forever. However, it does cost money to do a search of the NPII and not everyone does a search of the NPII when giving credit. 

This depends on where you are up to with your creditors and how you have treated them, but Bankruptcy is not necessarily your only option.

I explore your other options when we have a zoom conference with you.

An agreement with creditors is designed so that you do not lose your assets. You may be able to restructure your debts or refinance to obtain some cash to make a proposal to creditors.

This is an option that we do explore when I do a conference with you. 

There are a range of options that we can explore not just Bankruptcy, which includes a Section 73 proposal, Part X proposal, Part IX debt agreement or even an informal arrangement with creditors.

I will review your personal financial circumstances and make a recommendation as to which option will suit your unique circumstances, budget and desired outcome.