Your options

The right path for a company in financial difficulty depends on its circumstances: how urgent the pressure is, whether the business is still viable, and how much it owes. Start with the situation you are facing. Each guide below explains your options in plain English, with the deadlines and the law behind them.

Urgent: creditor and ATO pressure

If a creditor or the ATO is already taking action, deal with the deadline first.

• Can’t pay your debts?: which deadlines are running, and how the options compare.
• Statutory demand: 21 days from service to pay, settle or apply to set it aside.
• Director penalty notice (DPN): when the ATO makes directors personally liable for unpaid PAYG, GST and super.
• ATO debt: payment plans, restructuring and other ways to deal with company tax debt.

Restructure and turnaround

For a business that is still viable but carrying too much debt.

• Small Business Restructuring (SBR): for companies with liabilities under $1 million. Directors stay in control.
• Voluntary administration: an independent administrator takes control and explores a deal with creditors.
• Deed of company arrangement (DOCA): a binding deal with creditors that can keep the company out of liquidation.
• Safe harbour: protection from insolvent trading liability during a genuine turnaround.

Corporate insolvency

When the business is no longer viable, or a lender has stepped in.

• Creditors’ voluntary liquidation: an orderly closure started by the directors.
• Receivership: when a secured lender appoints a receiver over company assets.
• Insolvent trading: when directors become personally liable for company debts, and the defences.

Personal insolvency

For individuals, including directors facing personal liability.

• Bankruptcy: how bankruptcy works and what it means for you.
• Bankruptcy notice: the deadline to respond and your options.
• Personal insolvency agreement: a formal deal with creditors as an alternative to bankruptcy.

Compare your options

Side-by-side comparisons of the formal processes.

• Voluntary administration, SBR or liquidation: which formal option fits.
• DOCA or liquidation: what each means for creditors and directors.
• Liquidation or bankruptcy: company versus personal insolvency.

Talk it through

Not sure which applies to you? Our registered liquidators can explain your options in a free, confidential first consultation, in English, Mandarin, Cantonese or Korean. Sydney (02) 8318 3699, Brisbane (07) 3868 1888. See also our insights, including case studies and what creditors actually receive in an SBR.