Get help before you apply
If you don't think you'll be able to repay your debts you can
apply for bankruptcy. Only do this if you have explored all other
options, and seek legal advice or financial counselling before you
Bankruptcy is a process in which you are legally declared unable
to meet your debts. When you apply for bankruptcy you will be
released from most of the debts you owe and debt collectors will
stop contacting you.
Once you are declared bankrupt, you are classified as bankrupt
for 3 years and a trustee is appointed to look after your
Being bankrupt can permanently affect whether you can get credit
in the future. Your bankruptcy will be listed on your credit
report for 2 years from the date your bankruptcy ends, or
5 years from the date you became bankrupt (whichever is later). It
will also appear on a publicly-accessible register
called the National Personal
Insolvency Index (NPII).
You cannot be a director of a company without leave of the court
and you may not be able to work in certain trades and professions.
See the Australian Financial Security Authority's (AFSA) website
for more information on employment
There are other ways to sort out your finances other than
A financial counsellor can explain
options like debt recovery procedures. Financial counselling is a
free and confidential service. If you decide you do want to
declare yourself bankrupt a financial counsellor can help you to
understand the consequences.
Community legal centres and Legal Aid offices offer free legal
advice on bankruptcy. Services are available in every state and
How to apply for bankruptcy
Visit the AFSA website for information on how to declare personal bankruptcy.
If you're struggling to repay your debts, it's
important to get help straight away. Get legal advice or financial
counselling so you understand your options.
Last updated: 18 Feb 2019