Overview
Give feedback on proposed changes to Australia’s personal insolvency system.
The exposure draft would amend the Bankruptcy Act 1966 to:
increase the involuntary bankruptcy threshold from $10,000 to $20,000 and index it over time
give debtors 28 days to respond to a bankruptcy notice, up from 21 days
remove the proposal or acceptance of a debt agreement as an ‘act of bankruptcy’ under section 40(1).
Have your say
We want feedback from all users of the personal insolvency system. Your feedback will help identify concerns and apply the reforms effectively.
Read the attached exposure draft and its explanatory memorandum before providing your feedback.
Background
The government consulted on 4 proposals to improve Australia’s personal insolvency system in September 2023. It received 44 submissions from a range of sectors.
After considering the submissions, the former Attorney-General announced 4 priority reforms on 8 July 2024.
Machinery of Government changes transferred responsibility for the personal insolvency system to the Treasury in July 2025.
The exposure draft implements 3 of the 4 priority reforms.
The government also plans to reduce how long the public can search for a discharged bankrupt’s details on the National Personal Insolvency Index. We will consult on this reform at a later date.
