Your debtor sold the business. Who still owes you now?

Do not chase the wrong name

Your debtor has sold the business, but that does not automatically mean the money has moved with it. The first job is to slow things down and check the documents. Business.gov.au says a sale contract should set the handover date, what is being sold, and who deals with creditors the business owes money to. ([business.gov.au](https://business.gov.au/exiting/selling-your-business/sell-your-business))

If the sale involved a transfer to a new company, ASIC warns that phoenix activity can involve moving the business for little or no value and leaving debts behind with the old company. That is not proof of wrongdoing by itself, but it is enough reason to treat the sale papers as urgent evidence, not background noise. ([asic.gov.au](https://www.asic.gov.au/about-asic/contact-us/reporting-misconduct-to-asic/concerns-about-phoenix-activity))

Check what the sale papers say

Start by naming the exact debtor. Check the invoice, quote, subcontract, purchase order and ABN or ACN. If the account is in the old company’s name, keep chasing that entity until the paperwork shows a different obligation. The buyer’s trading name may look familiar, but the legal entity on the contract is what matters first. ([business.gov.au](https://business.gov.au/exiting/selling-your-business/sell-your-business))

Then check whether the sale contract dealt with existing debts. Business.gov.au says the contract should cover what happens if the buyer does not proceed, creditors the business owes money to, and who is paying employee entitlements. If those items are missing or vague, ask for the signed agreement, not a verbal summary. ([business.gov.au](https://business.gov.au/exiting/selling-your-business/sell-your-business))

Source: Official guidance

Beat the settlement date

Next, find out when settlement is due and who will receive the proceeds. Business.gov.au says the agreement should cover the sale price, payment method, handover date and settlement period. If money is still sitting with the seller, solicitor or broker, that may be the last practical moment to put your debt in front of it. ([business.gov.au](https://business.gov.au/exiting/selling-your-business/sell-your-business))

Send a written demand before settlement and copy anyone controlling the transaction. Keep it short: invoice number, amount, due date and the entity you say owes the debt. A clear paper trail matters because once the proceeds are paid out, your leverage usually drops and the sale can become harder to unwind. ([business.gov.au](https://business.gov.au/exiting/selling-your-business/sell-your-business))

Treat a cheap transfer as a warning

If the price looks too low, do not shrug and wait. ASIC says phoenix activity can involve a new company taking over an existing business for little or no value while leaving debts with the old company. That is a warning sign, not a final finding, but it is enough to escalate quickly. ([asic.gov.au](https://www.asic.gov.au/about-asic/contact-us/reporting-misconduct-to-asic/concerns-about-phoenix-activity))

If you have evidence that assets moved to another company, ASIC says to raise it with the liquidator first if one has been appointed. If there is no liquidator, a recovery specialist can help you test whether the file shows an ordinary sale, a debt dispute, or a transfer that needs closer scrutiny. ([asic.gov.au](https://www.asic.gov.au/about-asic/contact-us/reporting-misconduct-to-asic/concerns-about-phoenix-activity))

Move now while the paper trail exists

Today’s checklist is simple. Identify the debtor entity, get the sale contract, confirm settlement timing, and send your demand before the money moves. If the deal looks underpriced or the trail points to a stripped company, do not let the file sit. Ask for urgent recovery help while the paper trail is still alive. ([business.gov.au](https://business.gov.au/exiting/selling-your-business/sell-your-business))

If you want a second set of eyes on the documents, call CRP today about debt recovery. CRP coordinates independent qualified professionals who can review the invoice trail, the sale papers and the recovery options available to you. This article is general information only, not legal advice, and no outcome can be promised. ([business.gov.au](https://business.gov.au/exiting/selling-your-business/sell-your-business))