Welcome to the new R3 website. We hope you find it easy to navigate and access the information, events and training you need. We’re continuing to enhance the site and welcome feedback at [email protected].

Become a member

Creditor’s Support Hub

Intro text

If a company owes you money, there are several steps you can take. The key to recovering money you are owed is clear communication and documentation, or evidence, of the debt.

  1. Speak to the company about the money they owe you. Start with a phone call and make sure you have any important details such as order numbers, confirmation dates, the amount owed and also why the money is owed to you. Make a note of when you spoke to the company, who you spoke to, and what was agreed.
  2. If the money is not returned to you by the date they said on the phone, write to the company either by email or letter. You should include details such as the amount that you are owed, the reasons that the money is owed to you and also any time line expectations that were either discussed on the phone, or that you have, along with the details of the phone call(s) and what was agreed during the call.
  3. If the payment deadline is not met, and you are owed at least £750 which is not being disputed by the company, you can issue a statutory demand. A statutory demand is a legal notice that requests that payment of a debt within 21-days. You can issue a statutory demand yourself and do not need a solicitor. The amount you are owed must be a fixed amount, that has become due to you, and be undisputed. You need to use the prescribed form which can be found on the government website. There are strict rules which detail how the statutory demand must be issued, or served, to the company and this information can also be found on the government website.
  4. Court action and legal advice is the last resort. If the statutory demand has not been met and you have not received communication from the company or payment, you can apply to court for a winding-up order. Failure to respond to a statutory demand is an indicator of insolvency. Legal advice is strongly recommended before considering taking court action against a company.

If the company enters liquidation, administration, a voluntary arrangement or restructuring plan during the process please see the question ‘What does it mean if the firm or individual who owes me money becomes insolvency and an insolvency practitioner is appointed?’

If you are owed money by an individual, rather than a company, there are several actions you can take. The key to recovering money you are owed is clear communication and documentation, or evidence, of the debt. A person, or company, that owes you money may be referred to as a debtor.

  1. Speak to the individual about the money they owe you. Start with a phone call and make sure you have any important details such as the amount owed. Discuss the repayment and any payment plans that you agree on for the return of your money. Make a note of when you spoke to the individual and what was agreed in terms of payment dates or a payment plan.
  2. Write to the individual if payment is not forthcoming or a payment agreement is not met. Detail the amount that is owed, the reasons for the debt, and a deadline for payment.
  3. Go to mediation with the individual who owes you money. An impartial professional will assist both sides to come to an agreement about the money owed (the debt) and payment terms. A mediator can be found on the Civil Mediation Council website.
  4. If mediation does not work, you could make a claim to court for the money that you are owed. The court can order the debtor to pay you. However this can be costly and you may not get your money back.
  5. You can send a statutory demand to the individual. A statutory demand is a legal notice that requests that payment of a debt within 21-days. You can issue a statutory demand yourself and do not need a solicitor. The amount you are owed must be a fixed amount, that has become due to you, and be undisputed. You need to use the prescribed form which can be found on the government website. There are strict rules which detail how the statutory demand must be issued, or served, to the individual and this information can also be found on the government website.
  6. If the statutory demand is unanswered, and you are owed £5,000 or more, you can apply to court to make the individual bankrupt. More information on how to do this is available on the government website.

If the individual goes bankrupt or enters a voluntary arrangement while you are still owed money, please see the question ‘What does it mean if the firm or individual who owes me money becomes insolvency and an insolvency practitioner is appointed?’

Insolvency is an inability to pay debts when they are due, where the amount that is owed to everyone is greater than the value of what they own, or both. Insolvency can happen to an individual or business. They are referred to as debtors . There are different types of insolvency, but ones frequently reported in the news are liquidation, administration and bankruptcy.

If you are owed money, or other valuable goods, by a company or individual you are a creditor in the insolvency process.

Licensed Insolvency Practitioners manage the majority of insolvencies. They are experienced, qualified individuals who will conduct the insolvency according to the law. Further information on Insolvency Practitioners is available here.

The Insolvency Practitioner takes control of the debtors affairs. They sell any available assets and collect any debts due and convert everything the Debtor owns into cash. They act in the interest of all creditors to repay as much as possible to them. When an individual or company has entered a voluntary arrangement, the insolvency practitioner will collect the monthly contributions and then distribute them to the creditors at an agreed time. The details of the arrangement are set-out in the proposals.

The funds the Insolvency Practitioner receives are used in an order stipulated in law, starting with the costs of the insolvency, which includes their work done. Information about the order the Insolvency Practitioner pays the amount they receive is here.

There are different types of insolvency depending on the circumstances that occur. Whilst corporate and personal insolvency have many things in common, there are also some key differences. Our “Guide for creditors” gives information specific to the insolvency type in which you are interested. They are available for companies registered, and individuals declared insolvent, in England and Wales and Scotland.

Insolvency processes for companies

  • Administration – there are three main objectives of administration. The first is to rescue the business as a going concern (or trading business). The second objective is to achieve a better result for creditors as a whole than if the company went into liquidation. The third objective is to realise assets to make a distribution to one or more secured or preferential creditors. More information about administrations can be found on the Administration page. LINK
  • Liquidation – when there is no prospect of rescuing the company it enters liquidation. The company is closed down and debts are repaid to creditors out of the available assets. More information about liquidations can be found on the Liquidation page. LINK
  • Company voluntary arrangements (CVA) – a binding agreement between a company and its creditors, it is an extremely flexible process. The goal is for the a company to return to profit-making. A CVA may involve delayed or reduced payments of debt over a set period of time, capital restructuring, or an orderly disposal of assets. More information about company voluntary arrangements can be found on the CVA page. LINK