AustraliaI'm going bankrupt. Which of my assets are protected from creditors?
When you go bankrupt in Australia, certain essential assets are protected from creditors, including household goods, tools of trade up to $4,000, and most superannuation. Your family home is generally not protected unless it falls under specific exemptions.
What the Law Says
The Bankruptcy Act 1966 (Cth) sets out which assets a bankrupt person can keep — known as 'exempt property'. These protections aim to let you maintain a basic standard of living and continue working after bankruptcy.
Exempt property includes necessary household items like furniture, appliances, and personal effects — up to a total value of $8,000. This ensures you can keep essentials for daily life.
You may keep tools, equipment, or other items you need to earn an income — but only up to a total value of $4,000. This includes computers, machinery, or professional instruments used in your trade or business.
A motor vehicle (or vehicles) is protected only to the extent that your equity in it does not exceed $11,900. Equity means the market value minus any money you still owe on it (e.g., car loan). If your equity is higher, the trustee may sell it and return up to $11,900 to you.
Superannuation held in a regulated fund is fully protected — no matter how much is in your account — as long as you did not make contributions deliberately to defeat creditors.
Compensation payments for personal injury, wrongful imprisonment, or defamation are also fully exempt from creditors.
Statutory Text‘exempt property’ means... household items... tools of the trade... motor vehicles... superannuation interests... compensation for personal injury...
— Bankruptcy Act 1966 (Cth), s. 116(2) — Exempt property
Statutory TextThe value of tools of the trade must not exceed $4,000... the value of a motor vehicle must not exceed $11,900...
— Bankruptcy Act 1966 (Cth), s. 116(2)(c) and (d)
Statutory TextA bankrupt’s interest in a regulated superannuation fund is exempt property.
— Bankruptcy Act 1966 (Cth), s. 116(2)(d)(i)
What to Do
List all your assets and calculate your equity in each (e.g., car value minus loan balance).
Check whether each asset fits within the exempt categories and value limits in the Bankruptcy Act.
Disclose all assets honestly to your bankruptcy trustee — hiding assets is illegal and can extend your bankruptcy.
Seek free advice from the Australian Financial Security Authority (AFSA) or a registered financial counsellor before declaring bankruptcy.
Sources
Not legal advice. This article is general information based on publicly available sources, written for educational purposes. Laws change and individual situations vary. Consult a licensed attorney in your jurisdiction before acting on anything you read here. Last reviewed: 2026-06-08.