Recovering Money You Are Owed in England and Wales

Who should read this

• Freelancers and businesses with overdue invoices.
• Anyone who lent money to a friend or relative and has not been repaid.
• Landlords and others owed money under an agreement.

What the law says

• Most debts under a contract must be claimed within six years of the date payment was due (Limitation Act 1980). A written acknowledgment or a part payment by the debtor can restart that period.
• When the debtor is an individual or sole trader, the Pre-Action Protocol for Debt Claims requires a letter of claim with an Information Sheet and Reply Form, and a 30-day response period, before you start proceedings.
• Between businesses, the Late Payment of Commercial Debts (Interest) Act 1998 lets you claim statutory interest on late payment and a fixed sum of compensation.
• A county court judgment (CCJ) that is not paid within one month is entered on the public Register of Judgments, which affects the debtor’s credit rating.

Steps

1. Check your records — Confirm the amount, the due date and who the debtor is — an individual or a company.
2. Send reminders — A polite reminder, then a firmer one, often resolves genuine oversights.
3. Send a letter before action — The formal last demand before court: 30 days for individuals and sole traders (with the protocol forms), about 14 days for businesses.
4. Consider settlement — Consider any reply seriously — an instalment offer or mediation can be quicker and cheaper than court.
5. Make a court claim — Most money claims can be made online through Money Claim Online on GOV.UK.
6. Get judgment — If the debtor does not respond, ask for judgment in default; if they defend, the court decides the case.
7. Enforce the judgment — If they still do not pay, ask the court for enforcement: a warrant of control, an attachment of earnings order, a third party debt order or a charging order over property.

Documents you'll need

• The contract, order, agreement or loan agreement.
• Invoices, statements and proof of delivery or completed work.
• Your reminders, letter before action and any replies.

Fees

• Court fees depend on the amount claimed and are usually lower online; check GOV.UK for the current fees.
• Each enforcement method has its own court fee.
• Court fees are normally added to the judgment, so the debtor pays them if you win.

Timeline

From letter before action to judgment typically takes one to three months if the debt is not disputed, and longer if it is defended. Enforcement then takes weeks to months depending on the method.

Common mistakes

• Waiting too long — evidence goes stale and limitation periods run.
• Suing the wrong person, for example a company director instead of the company.
• Skipping the letter before action or the protocol forms for an individual.
• Spending on enforcement against someone with no money or assets to take.

Questions

What is a CCJ?

A county court judgment is a court order to pay money. If it is not paid within one month, it is recorded on the Register of Judgments for six years (unless paid in full within one month, or later paid and marked satisfied), which makes it harder for the debtor to get credit.

Can I use a debt collection agency instead?

Yes. Agencies charge a fee or commission and have no extra legal powers — only the court can order payment and enforce it.

What if the debtor is a company that has stopped trading?

Check its status on Companies House. If it is in liquidation or dissolved, a court claim may be pointless; you may need to submit a claim to the insolvency practitioner instead.

When to consult a lawyer

• The debt is large, or the debtor disputes it with a detailed defence.
• The debtor is insolvent or the company is being wound up.
• You want to enforce against property.

Related

• Create a letter before action →
• Making a small claim →
• Find a solicitor or barrister →