Statutory Demand — 2026 Creditor’s Guide

In short: A Statutory Demand is a formal written demand for an undisputed, due and payable debt — the escalation a business creditor or sole trader uses before insolvency proceedings, served on the prescribed form under the Insolvency (England and Wales) Rules 2016. It should only be used where the debt is not genuinely disputed; otherwise the court may set it aside with costs. eLitigant’s assistant, Chris, drafts your Statutory Demand from your own documents — or checks a draft you’ve written — for £30.The debtor has ignored the Letter Before Action. The court judgment has not concentrated their mind. They are either solvent and contemptuous, or insolvent and pretending. A Statutory Demand is the escalation — the last polite word before insolvency proceedings.

This guide is for business creditors and sole traders. A Statutory Demand is a serious instrument. Used correctly, it gets paid. Used carelessly, it invites a successful set-aside and a costs order against you. Chris drafts carefully.

When to use a Statutory Demand

• The debt is undisputed, due and payable
• The amount is over the statutory threshold (£750 company / £5,000 individual)
• You have already tried a Letter Before Action and, in most cases, a County Court claim
• You are prepared to follow through with insolvency proceedings if unpaid

When NOT to use a Statutory Demand

If the debt is genuinely disputed on substantial grounds, using a Statutory Demand is an abuse of process. The court will set it aside with costs. Use the civil courts to get judgment first, then escalate.

The prescribed form

For individual debtors: the form set out in the Insolvency (England and Wales) Rules 2016 Schedule 4. For companies: the form prescribed under the same Rules. Content includes:

• Creditor’s name and address
• Debtor’s name and address
• Amount of the debt
• Consideration for the debt (how it arose)
• Statement that the debt is owed and unpaid
• Statement of the consequences of non-payment
• Prescribed information about how to respond or apply to set aside

Service

Personal service on an individual is the gold standard — it defeats most set-aside applications on procedural grounds. For companies, service on the registered office. Keep a process server’s certificate of service.

The 21-day window

The debtor must pay, secure the debt, or compound it (agree terms) — or for individuals, apply to set aside. After 21 days, you can:

• Present a bankruptcy petition (individual debtor) — Form BP-01
• Present a winding-up petition (company debtor)

Set-aside grounds

The debtor will try:

• Substantial dispute — the debt is genuinely contested
• Cross-claim — the debtor has a counter-claim equal to or exceeding the debt
• Procedural defect — incorrect form, incorrect service, incorrect details
• Abuse of process — Statutory Demand used to pressure payment of a disputed debt

A well-drafted Statutory Demand closes these doors before they open.

Strategy — the sword and the shield

Most Statutory Demands are paid inside 21 days. The demand itself is the leverage. Insolvency proceedings are the backup. Present yourself as willing, ready, and prepared — because Chris has drafted the follow-on petition in parallel.

Can Chris draft your Statutory Demand?

Yes. Upload the contract, invoices, correspondence, any prior judgment. Chris drafts the Statutory Demand on the prescribed form, the covering letter, and — if you want the insolvency petition pre-drafted for the 22nd day — Express Case (£300/month) covers both documents plus follow-through.

Prepare to win. Plan not to fail.

Debtors fold when the paperwork is elite. Chris drafts elite.

Frequently asked questions

When should I use a Statutory Demand?

When the debt is undisputed, due and payable, over the statutory threshold (£750 for a company, £5,000 for an individual), you have already tried a Letter Before Action and in most cases a County Court claim, and you are prepared to follow through with insolvency proceedings if the debt stays unpaid.

When should I NOT use one?

If the debt is genuinely disputed on substantial grounds, using a Statutory Demand is an abuse of process — the court will set it aside with costs. In that situation use the civil courts to get judgment first, then escalate.

What form do I use?

The form prescribed under the Insolvency (England and Wales) Rules 2016, Schedule 4 — for individual debtors and, under the same Rules, for companies. It must include the creditor’s and debtor’s details, the amount, how the debt arose, a statement that it is owed and unpaid, the consequences of non-payment, and the prescribed information on how to respond or apply to set aside.

How should it be served?

Personal service on an individual is the gold standard, because it defeats most set-aside applications on procedural grounds. For companies, serve on the registered office. Keep a process server’s certificate of service.

What happens in the 21-day window?

The debtor must pay, secure the debt, compound it (agree terms) — or, for individuals, apply to set aside. After 21 days you can present a bankruptcy petition against an individual debtor, or a winding-up petition against a company debtor.

On what grounds can a debtor try to set it aside?

Substantial dispute, a cross-claim equal to or exceeding the debt, a procedural defect (wrong form, service or details), or abuse of process where the demand is used to pressure payment of a disputed debt. A well-drafted demand closes these doors before they open.

Related guides: Letter Before Action · Money Claim Online · All civil court forms