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Is my Business Eligible?

Is my business eligible?

To be eligible, your business must have:

01

Be a company (not a sole trader)

02

Have less than $1m in debt

Is my business eligible?

To be eligible, your business must:

01

Be a company (not a sole trader)

02

Have less than $1m in debt

Example

John operates a hardware store through a company J&C Hardware Pty Limited, which has 3 years to go on its store lease which is $48,000 a year and he has two employees who earn $42,000 and $28,000 each. He currently owes suppliers $80,000 for inventory and the ATO $60,000 in unpaid GST. The company also owes John’s parents $400,000 when he bought the business off his father 5 years ago.

Is J&C Hardware eligible for the small business restructuring process?

Unpaid rent to the end of lease $144,000
Wages owed to staff (one month) $7,500
Suppliers $80,000
ATO $60,000
Related creditor $400,000
Total Creditors $691,500

Given the debts are less than $1.0M the company meets the first part of the eligibility criteria. Before the plan is proposed the company must also pay monies owed to employees $7,500, and lodge its outstanding BAS and tax returns.

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