Some of our readers may not be aware that the government imposes a charge on the value of all assets realised in a bankrupt estate.
That charge is payable by the trustee as a priority before trustee’s fees and any return to creditors. The charge contributes to the cost of running the essential services provided by Insolvency and Trustee Service Australia (ITSA).
As from the 1st July the percentage taken has increased to 4.7%.
In addition to the Asset Realisation Charge (ARC), all interest earned on funds held in bankrupt estates must be remitted to the government. During 2012/13 trustees at the Worrells offices remitted the best part of $1 million dollars in ARC and interest on realisations and contributions approaching $20mill. Around 85% of the funds realised have or will be distributed to creditors by way of dividends.