Safe harbour protection is available from the point in time when the directors start developing one or more courses of action. There is no specified duration to safe harbour protection provided the company continues to work towards an outcome that was reasonably likely to provide a better outcome than formal insolvency.
Maybe. If you are an ASX listed company you will need to under your continuous disclosure rules but for SME companies there is no requirement to inform your creditors that you have implemented safe harbour.
Safe harbour will only protect directors from insolvent trading claims brought by a liquidator. Safe harbour does not protect directors from personal guarantee debts, claims for breaches of directors duties or criminal liability for insolvent trading.
No. ARITA has made it clear that a safe harbour adviser cannot accept a later insolvency appointment due to a lack of independence. Our safe harbour experts however can continue to advise you through an insolvency process.
You can lose safe harbour protection in any of the following ways: You fail to actually implement one or more of the courses of action that you have developed to enter safe harbour. You cease implementing a course of action.When any such action ceases to be reasonably likely to lead to a better outcome or upon the appointment of a liquidator/administrator. The company is not paying employee entitlements, including super. The company is not complying with its taxation obligations. The company must continue to lodge all tax returns and BAS’.
A formal insolvency appointment is likely to be unavoidable in this situation. It is clear that any advisor involved in the safe harbour process cannot later be Liquidator of the company or bankruptcy trustee of a director that tried to implement safe harbour if they cannot avoid declaring bankruptcy.
No. Safe harbour is not a formal insolvency appointment. It is an informal turnaround effort to save the business.
Safe harbour protection starts when directors begin to develop one or more courses of action that are reasonably likely to lead to a better outcome for the company than the immediate appointment of a liquidator or administrator.
The protect essentially starts as soon as you being developing a genuine way to turn around your company.
No. While you DO have to continue to lodge all BAS and tax returns, you do not have to pay the ATO to keep safe harbour protection. Of course for the company to survive it will be necessary to pay your tax debt, albeit over time by way of a payment plan.
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