Filing For Bankruptcy In Australia Now Costs $120

OK, this is odd. Under a change which was only announced last Friday night but which has already taken effect, it will cost you $120 to file for bankruptcy in Australia. Even stranger: you can charge that to your credit card, even though that card might well end up as one of your unpaid debts as a bankrupt.

Bankruptcy picture from Shutterstock

ABC News reports the changes were introduced late last week, and take effect from 1 April. While there was a consultation period prior to the change being introduced, none of the feedback from consumer groups was responded to, and the change was announced without notice.

The shift could net the government $25 million over four years. Governments already claim a share of any money that it returned to creditors by a bankrupt, which makes it hard to see this as anything other than revenue raising.

New bankruptcy fee to net Federal Government $25 million over four years [ABC News]


    I suspect the ones that will end up losing out here are the banks.

    It's pretty likely anyone declaring bankruptcy will end up having to put this fee on their credit card, which will end up getting rolled into the bankruptcy proceedings.

    The government will get their cash no matter what, it'll likely be the creditors that end up paying for it, however. Surely there are some legal (and certainly ethical) issues here, where you're knowingly allowing someone to go into debt with another party when they don't have the ability to pay it off?

      Good point the banks should sue the government for everyone who puts the fee on their credit card...and for that matter if the bankrupts had that ability they should sue the government for their making people pay for the service of saying they don't have the ability to pay when they obviously don't have the ability to pay

    Is this an April Fool joke?
    Where is the Labor backlash?

      I think so - just a touch too subtle.

      Its also not that hard to believe with the current government, so...

    Totally stupid, the only reason can be a government tiring to squeeze every dollar out of those who can't afford it, bloody idiots - if your having to go bankrupt you most likely don't have a spare $120 to throw away

    The ABC said that officially you can pay the fee on your credit card, but I would have thought that you weren't allowed to accrue new debts once your aware your insolvent. Can someone with a legal or accounting background answer that?

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