• Simon Taylor

Temporary Insolvency Relief Ends

As business owners and individuals, 2020 was like no other. For some, work life changed forever, some reinvented themselves or their businesses and many were thrown into managing work-life and trying to educate their children at the same time.

The Australian Government tried to help, and this has worked well for some of us, but for others, uncertainty remains as to whether they can survive in the new norm which is highly unpredictable especially on the Gold Coast where hospitality and tourism are the major earners.

2020 saw the Australian Government delay many personal bankruptcy and company liquidation matters for 6 months which meant that individuals and companies that were financially troubled in March 2020, had until much later in 2020 to try to steady the ship.

Temporary insolvency relief for individuals ended 31 December 2020. This means in relation to personal bankruptcy:

  • you can be made a bankrupt for a debt of $10,000 or over (reduced from $20,000 during the COVID-19 relief period).

  • you now have to respond to a bankruptcy notice within 21 days which was 6 months during the COVID-19 relief period.

  • the period for temporary debt protection permits 21 days relief from creditors, instead of 6 months during the COVID-19 relief period.

As for companies, the 2020 COVID-19 relief measures also ended on 31 December 2020. During the COVID-19 period in 2020, the government gave company directors a temporary freeze on prosecutions and they were not personally pursued in a court for trading while insolvent in relation to normal operating company debts.

The Australian Government from 1 January 2021, introduced what it says are simplified measures to reorganise Small Business debt. A link to the factsheet is here:


Briefly put, if you are a Small Business and you think you might be in financial trouble, you should talk to a small business restructuring practitioner. This may be your current accountant or financial advisor, or you may prefer to appoint a specialist in insolvency.

If you are walking on the edge of bankruptcy or insolvency, take the leap, don't fall in a hole, land safely on the other side with the guidance of a suitable insolvency professional.


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