Tools Of Trade Definition and Legal Meaning
On this page, you'll find the legal definition and meaning of Tools Of Trade, written in plain English, along with examples of how it is used.
What is Tools Of Trade?
Under Bankruptcy law, the instruments, equipments and tools used by an individual in his occupation , such as machinery, devices etc, which he can individually run without the help of the additional labour,are his tools of trade. Under this law, these are exempted from any claims of creditors as law considers these as the only daily source of income and survival in support of his family and also the means of earning to repay creditors.
History and Meaning of Tools Of Trade
Tools of trade is a legal term used in bankruptcy law to describe the instruments and equipment that an individual uses in their occupation. These tools can include machinery, devices, and other materials that an individual can use to generate income on a regular basis.
The law considers these tools as vital for a person's daily source of income and survival, and so they are exempt from any claims of creditors. In essence, a person's tools of trade are the means by which they can earn a living and, therefore, repay their debts.
Examples of Tools Of Trade
- A carpenter's tools, including saws, hammers, and drills.
- A chef's knives, pots and pans, and other cooking equipment.
- A mechanic's wrenches, sockets, and other tools used for repairing vehicles.
- A farmer's tractors, plows, and harvesting equipment.
- A photographer's camera, lenses, and lighting equipment.
Legal Terms Similar to Tools Of Trade
- Exemptions: Exemptions refer to property and assets that are exempt from the claims of creditors during bankruptcy proceedings.
- Wages: Wages are a person's earnings from their employment.
- Business equipment: Business equipment refers to any property or tools used in the operation of a business.