Statutory Demand
- Winding-up
- Bankruptcy
- Statutory Demand
- High Court Enforcement Officer
- Bailiff
- Default Judgment
- County Court Judgment (CCJ)
- Letter Before Action (LBA)
- Garnishment exemption limit
- Accounts receivable management
- Attachment and assignment order
- Inability to pay
- Risk managament
- Inkassovollmacht
- Cedent
- Cash flow
- Third-party debtor
- Legal aid in civil proceedings
- Statement of defence
- Third-party debtor declaration
- OPOS
- Injunction
- Claim amount
- Assignment
- Direct debit return
- Payment extension
- Insolvency administrator
- Retention of title
- Trustee
- Consumer insolvency
- Standard insolvency
- Foreclosure
- Payment term
- Payment plan
- B2C
- B2B
- Base interest rate
- Credit Score
- Liquidity
- Affidavit
- Credit insurance
- Factoring
- Objection
- Foreclosure
- Default of payment
- SCHUFA
- Enforcement Officer
- Opposition
- Dunning notice
- Statute of limitations
What is a Statutory Demand?
A Statutory Demand is a formal legal document used under insolvency law in England and Wales. It is part of the UK insolvency system and follows strict statutory rules.
The document sets out a specific debt that is said to be due and payable. It is not a court judgment. It is also not a normal reminder letter. A Statutory Demand is a formal notice created under insolvency legislation.
It belongs to the legal framework that governs Insolvency Proceedings. The demand is used within that framework and must follow prescribed legal formats. Different official forms exist depending on whether the debtor is an individual or a company.
A Statutory Demand does not itself decide a dispute. It is a formal step within insolvency law. Its purpose is procedural. It records a claim in a legally defined way under the insolvency rules of England and Wales.
When is a Statutory Demand used?
A Statutory Demand is used at a specific stage in the legal process. It appears before formal Insolvency Proceedings may begin.
It is not used during ordinary debt collection. It is also not part of a standard civil court claim. Instead, it sits between regular recovery efforts and formal insolvency procedures.
In the overall legal timeline, the sequence may look like this:
initial payment requests or debt recovery steps
if the matter moves beyond ordinary collection,
a Statutory Demand may be issued
if insolvency criteria are met, formal Insolvency Proceedings may follow
The demand marks a transition from normal civil recovery activity to the insolvency framework. It operates under insolvency law rather than under general civil procedure rules.
For which types of debts can a Statutory Demand be issued?
A Statutory Demand can be issued for certain qualifying debts under UK insolvency law. The debt must meet legal criteria set by statute.
One important factor is the minimum debt threshold. Under current law in England and Wales:
for individuals, the debt must usually be at least £5,000
for companies, the debt must usually be at least £750
These thresholds mean that Statutory Demands are typically relevant for higher-value debts. They are not intended for very small claims.
The debt must also be:
specific in amount
due and payable
not subject to a genuine dispute on substantial grounds
Statutory Demands can be used in relation to:
personal debts owed by individuals
commercial debts owed by companies
The legal framework applies differently depending on whether the debtor is a person or a company, but the statutory concept remains the same.
How is a Statutory Demand formally issued and served?
A Statutory Demand must follow strict formal requirements. It cannot be drafted informally. The content and format are prescribed by insolvency legislation.
The document must include:
Official forms are used for different situations. For example, separate forms exist for individuals and companies.
Service of the Statutory Demand is also regulated. It must be properly delivered to the debtor. For individuals, personal service is often required. For companies, service may follow corporate service rules under insolvency law.
The date of service is important because it starts a statutory period defined by insolvency legislation. The process is therefore formal and structured from beginning to end.
How does a Statutory Demand relate to Insolvency Proceedings?
A Statutory Demand is closely connected to Insolvency Proceedings. It may form part of the procedural steps that lead toward formal insolvency action.
In particular, it is linked to:
Bankruptcy proceedings for individuals
Winding-up proceedings for companies
If certain statutory conditions are met after service of the demand, the creditor may apply for a bankruptcy order (for individuals) or a winding-up petition (for companies).
In this way, the Statutory Demand can operate as a formal step within the insolvency pathway. It does not itself create insolvency, but it can form part of the structured legal process that leads into a formal insolvency procedure.
Its role is therefore procedural and statutory. It connects unpaid debt to the insolvency system under defined legal rules.
How does a Statutory Demand differ from a court claim?
A Statutory Demand differs clearly from a County Court Claim.
A County Court Claim is part of the normal civil court system. It starts a lawsuit under the Civil Procedure Rules. The court examines the case and may issue a judgment.
A Statutory Demand is not a lawsuit. It does not start ordinary civil litigation. It does not ask the court to decide the dispute at that stage.
The key differences are:
A County Court Claim belongs to general civil procedure law.
A Statutory Demand belongs to insolvency law.
A court claim seeks a judgment on a specific dispute.
A Statutory Demand records a qualifying debt within the insolvency framework.
The two processes operate under different legal systems within England and Wales. One is focused on civil litigation. The other is part of the insolvency regime.
Both are formal legal mechanisms, but they serve different procedural roles within UK law.