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  • Checklist to assist insolvency practitioners

    To assist insolvency practitioners when preparing an indemnity request, we have developed an Indemnity checklist (Part 1 and Part 2) and Annexure A:

    It is important you refer to the online version each time you prepare an indemnity request. This will ensure the information is current.

    How to use the indemnity checklist

    The indemnity checklist comprises Part 1 and Part 2 with a fillable form at Annexure A:

    • All indemnity requests must be in writing and address Part 1.
    • Part 2 will also need to be addressed where the indemnity is being sought to commence a litigation action.
    • Annexure A requires a breakdown of the total costs of an indemnity sought on a task-by-task basis, which will provide a total for the indemnity being sought.

    The Annexure A document will be incorporated into a Deed of Indemnity in the event that the indemnity is approved.

    Terms of the Deed of Indemnity

    The terms of the Deed of Indemnity will not only limit the amount of the indemnity to the overall total approved but will also limit the amount that the Deputy Commissioner of Taxation (DCT) will indemnify on a task-by-task basis, unless approved otherwise in a Deed of Variation.

    The indemnity will specifically exclude payment of certain costs incurred by insolvency practitioners, including such costs relating to:

    • duties a liquidator or trustee are required by relevant legislation to perform
    • preparing and submitting the indemnity request
    • communicating with the DCT's officials in relation to the request
    • executing the indemnity agreement
    • reporting to the DCT
    • preparing invoices and all tasks associated with invoicing, including forecasting
    • general ongoing administration of the Deed of Indemnity and any variations agreed to.

    Costs and expenses should be treated as costs of the liquidation or bankrupt estate and paid in the prescribed order of priorities pursuant to section 556 of the Corporations Act 2001 (in the case of company liquidations) or section 109 of the Bankruptcy Act 1966 (in the case of bankrupt estates).

    See also:

    Last modified: 02 Mar 2018QC 43958