Indexed Amounts

The Bankruptcy Act and Regulations contain a number of thresholds, limits and other amounts that are regularly indexed (changed in line with the Consumer Price Index or the base pension rate).
Contents
  1. Protected property
  2. Credit limit
  3. Official Receiver allowances and advances
  4. Part IX debt agreement eligibility
  5. Other amounts
  6. Income contributions
  7. Dependants
  8. Bankruptcy notice
  9. Historical indexations

Release date: 28 January 2015

Protected Property

Protected property Limit Bankruptcy Act & Regulations
Tools

A bankrupt may keep tools used to earn an income up to this limit.

$3,650 s116(2)(c)(i) and R6.03B (1) & (2)
Vehicles

A bankrupt may keep vehicles (cars or motorbikes) used mainly for transport up to this limit. The amount refers to the equity in the vehicles (the value of the vehicles less the sum owing under finance).

$7,500 s116(2)(ca) and R6.03B (3) & (4)
Limits updated each financial year

Credit Limit

Credit limit Limit Bankruptcy Act & Regulations
Above this limit, bankrupts and debt agreement debtors* must disclose their bankrupt or debtor status when seeking to obtain goods or services on credit, by hire purchase or cheque; when leasing, hiring or promising to pay for goods and services; or when seeking to obtain an amount by promising to supply goods or render services. $5,398 s269(1)(a), (aa), (ab), (ac), (ad) and s304A(1)(j)
Warning

Failure to disclose bankrupt or debtor status in the above mentioned circumstances can result in criminal penalties.

A trustee may lodge an objection if a bankrupt engages in misleading conduct in respect of an amount, or combined amounts, which exceed this limit. s149D(1)(c) and s304A(1)(g)
Limit updated quarterly

*This extends to debtors in debt agreements that commenced on or after 1 December 2010

Official Receiver Allowances and Advances

Official Receiver allowances and advances Limit Bankruptcy Act & Regulations
Attendance

A person, other than a bankrupt, who attends before the Official Receiver or authorised officer to give evidence/information is entitled to this allowance.

$21 s77D(1)(a) and s304A(1)(a)
Advances

Where a person is required to attend before the Official Receiver, the Official Receiver must offer the following advances on allowances and reimbursement of expenses before a person begins travelling by:

    • aircraft
$21 s77E(2) and s304A(1)(b)
    • private motor vehicle
$21 s77E(3) and s304A(1)(c)
    • other
$21 s77E(4)(a) & (b) and s304A(1)(d) & (e)
Limits updated quarterly

Part IX Debt Agreement Eligibility

Protected property Limit Bankruptcy Act & Regulations
Unsecured debts
A person cannot propose a debt agreement if their unsecured debts are more than this limit.

Unsecured assets

A person cannot propose a debt agreement if their divisible property is more than this limit.

$106,561.00 s185C(4)(b), (c) & (5)
Income level
A person cannot propose a debt agreement if their after tax income for the year is more than this limit.
$79,920.75 s185C(4)(d) & (5)
Limits updated twice a year: 20 March and 20 September

Other Amounts

Other amounts Limit Bankruptcy Act & Regulations
Registered trustee minimum fee entitlement
Trustees administering a bankruptcy, PIA or s188 authority commencing or executed on or after 1 December 2010 may recover this amount as remuneration from the estate where remuneration otherwise payable is less than this amount^.
$5,000* s161B(1)
Limits updated quarterly
Extent of priority for employee amounts
If an employee is owed money by a bankrupt, they are entitled to receive payment of any dividends issued in preference to those issued to other unsecured creditors, up to this limit.
$4,300 s109(1)(e) and R6.02
Limit updated each financial year

*For bankruptcies, PIAs and s188 authorities executed prior to 1 December 2010, trustees may recover $1,779† (depending on the date of appointment) from the bankrupt/debtor under former s304(1)(i), to the extent they cannot recover from the estate.

^ This amount is not indexed.

† This amount is indexed.

Income Contributions

Income contributions Limit Bankruptcy Act & Regulations
Base Income Threshold Amount (BITA) no dependants
Used when calculating a bankrupt’s income contributions
(net of tax)
$53,280.50
s139K
Actual Income Threshold Amount (AITA) with dependants
Used when calculating a bankrupt’s income contributions which vary according to the number of dependants.
s139K
Dependants Income limit
0 $53,280.50
1 $62,870.99
2 $67,666.24
3 $70,330.26
4 $71,395.87
over 4 $72,461.48
Limits updated twice a year: 20 March and 20 September

Dependants

Dependants Limit Bankruptcy Act & Regulations
Amount a person can earn and still remain a ‘dependant’
A person may earn income up to this limit during the contribution assessment period and still be considered a dependant for the purpose of calculating a bankrupt’s income contribution liability.
$3,404 s139K and R6.15A
Limits updated quarterly

Bankruptcy Notice

Bankruptcy notice Limit Bankruptcy Act & Regulations
This is the minimum amount upon which a bankruptcy notice can be issued (it may be comprised of one or more final judgments/orders) $5,000 s41
The minimum judgment amount is set by the Bankruptcy Act and is not indexed

Historical indexations

Historical indexations [PDF 71 KB]

Source:     AFSA

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