Statutory Demand

Contents

Overview

A statutory demand is a formal document used to demand payment for a debt that is owed. (£750 or more for a Limited company or £5000 or more for an individual, sole trader or partnership)


It is typically issued by a creditor to a debtor and is governed by the provisions of the Insolvency Act 1986.


A statutory demand is therefore a serious matter and it is important that debtors take it seriously and seek legal advice if necessary.

What is a statutory demand?

A statutory demand can be used by an individual or organisation to ask for money owed from a person or business.



Once a statutory demand has been served, the debtor has a limited period of time in which to either pay the debt in full or reach an arrangement with the creditor to pay it off over time.If the debt is not paid or an arrangement is not reached, the creditor may then take further legal action, including applying to the court for a winding up order or a bankruptcy petition. 

Statutory Demand Process

Here is a step-by-step guide to the statutory demand process in the UK:


It is important to note that a statutory demand is a serious matter and should not be taken lightly. You should seek legal advice if you receive a statutory demand, as there may be legal defences available or alternative options for resolving the debt.

Challenge a Statutory Demand

If you have received a statutory demand and believe that the debt is not payable or that there are grounds to have the demand set aside, there are several steps you can take to defend it:




It is important to note that defending a statutory demand can be complex and may require a detailed understanding of the law and legal procedures. It is strongly recommended that you seek professional legal advice if you are faced with a statutory demand.