Monitoring your cash-flow is essential for the smooth running of all businesses; whether large or small. When glitches occur, you may need help to elicit money owing from straggling debtors.

If you are owed £750.00 or more from an individual or a company, a statutory demand can be a useful tool to extract payment from slow or bad payers. The procedure for issuing a statutory demand has to be followed properly, and you should seek legal advice to do so.

If a statutory demand is ignored it can lead to bankruptcy or liquidation so debtors who do not want to become insolvent usually respond quickly by making a payment or entering into a payment plan.

The criteria:

• the debt must be £750 or more;
• the debt must be undisputed;
• the debt must be due and payable;
• there must be no security given in relation to the debt;
• if the debt is owed by an individual then the statutory demand must be personally served;
• the debtor has 21 days to pay; and
• the demand must be in a prescribed form.

If a debtor fails to respond to the statutory demand, you will be entitled to issue a bankruptcy or a winding-up petition which will lead to the insolvency of the company or the individual.

If you have been served with a statutory demand you should seek urgent legal advice to avoid insolvency.

Ansons Solicitors in Cannock and Lichfield have a specialist debt recovery team. We offer fixed fees for issuing statutory demands, bankruptcy petitions and winding-up petitions.  Please contact Jagdip Bains on 01543 267 196 for further information.