A recent Queensland Supreme Court decision calls into question the effectiveness of gift and loan back arrangement as an asset protection strategy. What are gift and loan backs? A gift and loan back is an asset protection strategy which involves transferring assets or rights to another legal entity to protect it from claims from third parties such as potential creditors.   We previously wrote a blog on how gift and loan backs could be used to protect the equity in your home- https://neweralaw.com.au/asset-protection-strategies/. Recent case In Re Parmewan No. 2 [2022] QSC 114, the Court held that a gift and loan strategy, which was implemented in an attempt to prevent the children of a deceased person from contesting a will, was unenforceable on the...

Does a company owe you money? If a company owes you money, you can recover your debt by issuing the company with a creditor’s statutory demand. To be eligible to issue a statutory demand, the debt must be equal to or greater than $4,000. You cannot serve an individual with a creditor’s statutory demand. Additionally, the debt must be due and payable, and there must be no dispute as to the existence of the debt or the amount owed. The debt is not due and payable if, for example, the company has 30 days to arrange payment and only 21 days have passed. What is a Statutory Demand? A statutory demand is issued by a creditor to a company, for a debt or judgment debt...

What? Due diligence is the most important step you can take when looking at buying a business or its assets. It is a process of investigation that summarises the business, its material assets, liabilities, risks, contracts and insurances. When? We recommend conducting due diligence prior to entering into a contract to ensure any identified risks or issues are addressed in contract negotiations. Alternatively, the contract should be subject to completion of satisfactory due diligence by the purchaser. Why? Due Diligence is an important step in ensuring that a buyer is making an informed decision when it comes to purchasing a business. Due diligence often uncovers information that may not be readily available or disclosed by the seller during initial negotiations. Therefore, while due diligence can...

Making employee share schemes more accessible for small and medium enterprises   Employee Share Schemes (ESS) are a great tool for small and medium enterprises (SMEs) to attract and retain emerging talent and increase employee productivity, performance and engagement. This is because ESS provide the opportunity for employees to acquire equity in the company they work for as part of their employment package. Unfortunately, ESS are often underutilised by employers due to the limitations imposed on ESS under the Corporations Act 2001 (Cth), and the subsequent expense which would be incurred by the employer in meeting legislative requirements. However, the red tape, limitations and requirements associated with ESS are set to be reduced from 1 July 2022. Following the 2022/23 Federal Budget, the...

Federal Budget 2022-23 Overview   On 29 March 2022, the Morrison Government unveiled the 2022-23 Federal Budget. With an election looming, this year’s budget aimed to ease the rising cost of living. Australians will be able to claim short-term relief through one off payments and fuel excises. The budget is estimated to have a deficit of $78 billion in 2022/23, narrowing to $43.1 billion by 2025. Here are the biggest takeaways from this year’s Federal Budget. Note, these are proposals and are subject to being passed through Parliament. Winners   Some favourable outcomes applicable to the general public include the fuel excise being cut in half (from 44c to 22c per litre) for the next 6 months and the cost of taking a compulsory work-related COVID-19...