1. What are the implications of bankruptcy?

Bankruptcy is not a ‘simple fix’ to financial problems. It is a complex and serious situation with significant consequences and should not be entered lightly. Before declaring bankruptcy you should seek specialist advice.

2. Who else can apply to make me bankrupt?

You can apply for bankruptcy if:

• You are unable to pay your debts when they are due; and
• You are present in Australia.

A creditor may apply to make you bankrupt if you owe them $10,000 or more. More than one creditor (people that you owe money to) can do this jointly if you owe them $10,000 or more in total.

3. The cost of filing for bankruptcy

There is no fee to apply to become bankrupt.

4. How do I file for bankruptcy?

To apply for bankruptcy you need to:

• create an Insolvency Services account;
• Prove your identity; and
• Complete and submit a bankruptcy Form through your Insolvency Services account.

5. What happens if I become bankrupt?

If you become bankrupt, most of your debts will be covered and you will no longer have to repay them. There are exceptions (see below). In some cases, your trustee may sell your assets or use compulsory payments to help pay your debts.

1. When you become bankrupt, most of your property will generally be under the control of a trustee who will manage your bankruptcy.
2. If you have any significant assets you would expect to have to surrender them for the benefit of your creditors. The creditor will usually recover the following assets:
   1. Houses, land, farms and business premises,
   2. Shares and investments,
   3. Tax refunds for income earned before you became bankrupt,
   4. Proceeds of a deceased estate where the person died before or during your bankruptcy,
   5. Lottery winnings and other competition prizes.
3. You are still allowed to keep some assets while in bankruptcy:
   1. Most ordinary household items,
   2. Items that are reasonably appropriate for the household,
   3. Tools used to earn certain income,
   4. Some vehicles,
   5. Assets held by you in trust for someone else,
4. The fact that you have gone bankrupt will affect your credit rating.

6. What happens to my income?

You may earn any amount of income while you’re bankrupt. You can also save any amount during your bankruptcy. However, if your after-tax income exceeds a set amount (https://www.afsa.gov.au/ insolvency/how-we-can-help/indexed-amounts-0), you may have to make compulsory payments. This amount changes with how many dependants you have.

Your trustee can use these payments to contribute to your debts and help pay them off. Compulsory income payments are usually 50% of the amount you earn above the income threshold.

7. How can bankruptcy affect my future?

Bankruptcy can affect:

• Future income;
• Future employment;
• Business;
• Ability to travel overseas;
• Ability to obtain future credit;
• Your rights to take legal action;
• Your trustee can sell your property; and
• Your name will appear on the National Personal Insolvency Index which is a public register.

8. When does Bankruptcy end?

Generally after 3 years. However, if an objection is made to your bankruptcy ending you could be bankrupt for 5 or 8 years.

9. Exceptions to bankruptcy protection

Filing for bankruptcy will protect you from certain creditors being able to continue or commence action to recover debts you owe them. However, bankruptcy does not affect certain debts including:

• fines
• child support & maintenance
• HECS & HELP debts (government student loans)
• debts you incur after your bankruptcy begins
• unliquidated debts (e.g. a debt where you and your creditor are yet to determine the amount)
• House mortgages
• Business loans secured by a business asset
• Council rates
• Water rates
• Debts incurred by means of fraud or fraudulent breach of trust.

For more information see: https://www.afsa.gov.au/insolvency/i-cant-pay-my- debts/what-happens-my-debts-when-im-bankrupt/ debt-comparison-table

10. Where can I get more information?

• Call Street Law for help on 6218 7900. We are a free legal service for people who are homeless or at risk of homelessness
• Call a financial counsellor such as Care Financial Counselling on (02) 6257 1788
• Contact the Australian Financial Security Authority on 1300 364 785
• Contact the National Debt Hotline on 1300 007 007
• Contact a private lawyer or financial advisor
• See https://www.afsa.gov.au/

Street Law acknowledges the Australian Financial Security Authority website as a source for much of the information contained in the factsheet.

If you’ve been a victim of an act of violence that happened in the ACT you may be able to get some financial assistance under the ACT Victims of Crime Financial Assistance Scheme.

1. Who can seek financial assistance?

You can seek financial assistance under the Victims of Crime Financial Assistance Scheme if you are:

• a primary victim — a person who is injured or dies as a direct result of an act of violence;
• related to, or in a relationship with, the primary victim and you are dependent on the primary victim;
• related or in a relationship with the primary victim who has died as a result of the act of violence;
• present when a homicide occurred or are a witness in a homicide criminal investigation and are injured by this; or
• paying for the funeral of the primary victim.

2. What is an act of violence?

To be a primary victim you to have been the victim of an act of violence.

An act of violence is a crime that causes a person’s injury or death. Examples of offences that can cause injury or death include (but are not limited to):

• murder;
• manslaughter
• assault;
• sexual assault;
• robbery;
• stalking;
• family violence offences, which can include:
  • destroying or damaging property;
  • arson;
  • forcible entry onto land;
  • dangerous driving; and
  • contravention of family violence order.

You must report the act of violence to the Police before you submit your application. You may still be able to get financial assistance even if the person who committed the act of violence can’t be identified or has not been charged, convicted or found guilty of the offence.

If you did not report the act of violence to Police you may still be entitled to financial assistance if you are a special reporting class victim.

A special reporting class victim is:

• a victim of a sexual offence; or
• a victim of an offence and the person who committed the offence was in a position of power over that victim (for example, teacher, carer or parent); or
• a victim under the age of 18 when the act of violence happened; or
• someone with impaired physically, psychologically or intellectual capacity; or
• a victim who did not report the act of violence to Police because they were threatened.

A special reporting class victim needs to report the act of violence to two of the following:

• a government agency;
• a doctor;
• a psychologist or counsellor; or
• a social worker.

3. What is considered an injury?

To be the victim of an act of violence you must suffer an injury caused by the violence.

An injury can be a:

• physical injury,
• mental illness; and/or
• mental disorder.

If the injury is caused by a sexual offence or family violence offence, then injury also includes an unplanned pregnancy, a sense of violation, a reduced sense of self-worth and increased fear or feelings of insecurity.

4. Financial Assistance you can seek

However, the maximum amount for financial assistance relating to a family violence offences is $10,833.

5. Ineligibility for financial assistance

You will not be eligible for financial assistance if:

• you plan the act of violence with the offender;
• the act of violence was committed because you were involved with a serious crime;
• you did not give the police reasonable assistance in relation to the act of violence.

You will also have your payment reduced if you receive any associated payments that cover the same harm or loss that the financial assistance would cover.

6. Applications

An application must:

• be in writing;
• include your contact address;
• state the type of payment you are requesting;
• evidence that the act of violence was reported to police.

You should include supporting documentation with the application. This may include:

• medical reports about your injury;
• police statements;
• receipts,
• quotes or invoices for any other money you spent because of the act of violence; and
• your payslips if applying for lost wages.

7. How to apply

Applications are made to Victim Support ACT and decided by the Victims of Crime Commissioner. The application form is available here https://www. victimsupport.act.gov.au/financial-assistance- scheme/new-financial-assistance-scheme-1-july-2016/ applying-for-financial-assistance.

Submit your application to:

8. Time limits

You have three years from the most recent act of violence to apply for financial assistance.

If you were under the age of 18 when the act of violence occurred you have three years from the time you turned 18 to apply.

You must make the application for the funeral expenses payment within 3 years after the death of the Primary Victim.

Where the Commissioner considers it reasonable the time for making an application may be extended.

9. Where can I get more information?

• Call Street Law for help on 6218 7995 or email us on streetlaw@canberracommunitylaw.org.au. We are a free legal service for people in the ACT who are homeless or at risk of homelessness.
• Visit www.victimsupport.act.gov.au

1. Early access because of a ‘specified compassionate grounds

The law provides for the early release of superannuation where a person can establish one of the following “compassionate grounds”:

1. medical treatment for yourself or your dependant;
2. transport costs for you or your dependant to access medical treatment;
3. mortgage assistance to prevent your bank or lender repossessing or selling your home;
4. modifications to your home and/or motor vehicle to accommodate a severe disability suffered by yourself or a dependant;
5. care for a dependent with a terminal medical condition;
6. funeral expenses for you to pay for expenses associated with a dependant’s death, funeral or burial; or
7. the person is suffering from a terminal illness and requires care.

2. How to apply for early release of super on compassionate grounds

You will need to apply through the Australian Taxation Office (ATO). The application process is a 3 stage process:

1. Apply using the ATO’s online form. The ATO will assess your eligibility for compassionate release of superannuation, which can take up to 14 days. Once your application is assessed, a message will be sent to your myGov inbox with the outcome. If your application is successful, your super fund will be notified.
2. If your application is approved, you must contact your super fund to arrange release of your money. You will need to provide the fund with a copy of the approval letter to process your payment.
3. Pay the expenses you need to pay and keep your receipts.

To access your superannuation early on compassionate grounds you must apply online. If you cannot apply online phone the ATO on 13 10 20.

3. Early access because of severe financial hardship

There are two ways you may be eligible for early access to your super if you are suffering severe financial hardship. You will need to contact your super fund directly to find out their application process.

Type A: To show “severe financial hardship” you must:

To show severe financial hardship you must:

1. have been receiving payments from Centrelink for26 weeks;
2. be receiving Centrelink payments at the time you apply to Centrelink for early access to your superannuation; and
3. be unable to meet “reasonable and immediate family living expenses” (ie you do not have enough money or assets to pay for the basic necessities of everyday living).

Type B: You can also show severe financial hardship if you:

You can show severe financial hardship if you:

1. have reached your “preservation age” (between 55 and 60 years);
2. have been receiving payments from Centrelink for 39 weeks after reaching your preservation age; and
3. are not employed full-time or part-time.

If you are granted early access to your super, you must notify Centrelink.

4. Early access because of terminal illness

You can apply to your superannuation fund for early access to your superannuation if you have a medical condition that is likely to result in your death within the next 24 months. You will need to provide medical evidence from two medical practitioners (one must be a specialist).

5. Early access because of incapacity

You can apply to your superannuation fund for early access to your superannuation if you can demonstrate that you have suffered either:

• permanent incapacity – you have a physical or mental medical condition that is likely to stop you from ever working again in a job you were qualified to do by education, training or experience; or
• temporary incapacity – you are temporarily unable to work, or need to work less hours, because of a physical or mental medical condition.

You will need to provide medical evidence from two medical practitioners (one must be a specialist).

6. Accessing a superannuation balance of less than $200

If the balance of your superannuation account is less than $200, you may be able to apply to your superannuation fund to claim the balance of your account simply because you wish to access it.

7. Departing the country

You can claim all of your superannuation if:

• you are not a permanent resident of Australia (or a citizen of New Zealand); and
• when you visited Australian your visa was temporary; and
• you have left Australia; and
• your visa is no longer valid.

8. Death Benefit

If you are the dependent of a person who has died you may be eligible to receive all or a portion of the deceased person’s superannuation benefit and any life insurance. You should check with the deceased person’s superannuation fund to find out if you were their ‘nominated beneficiary’.

9. Total and Permanent Disability Insurance

Some super funds provide their members with total and permanent disability insurance. This provides you cover if you become totally and permanently disabled. Talk to your super fund to find out whether you have this insurance, the eligibility requirements and how you can make a claim.

Contact Street Law on (02) 6218 7900 for more information.