Debt collection · United Kingdom
Statutory demand — the step before a bankruptcy petition
This is not a court order and no judge has seen it. What it does is set up a bankruptcy petition: once three weeks pass with it neither paid nor set aside, the law treats you as unable to pay. The window to challenge it is shorter still — eighteen days.
How serious: enforcement closeAlso called: stat demand, demand under section 268, Form SD1, bankruptcy demand
A creditor owed an unsecured debt can serve a statutory demand without asking anyone's permission. It demands payment, or that the debt be secured or compounded for to the creditor's satisfaction.
Two periods run from the day it was served. Rule 10.4 of the Insolvency (England and Wales) Rules 2016 gives eighteen days to apply to the court to set the demand aside. Section 268 of the Insolvency Act 1986 says that once at least three weeks have elapsed with the demand neither complied with nor set aside, the debtor appears unable to pay.
Filing the set-aside application stops the compliance period running. Nothing else does — not a phone call, not an offer, not a dispute by letter.
Who sends it
A creditor owed an unsecured debt, or the solicitors acting for one. A lender, a supplier, a landlord, a former business partner. No court is involved at this stage.
A printed form headed 'Statutory Demand', with the creditor's details and the amount, a warning that bankruptcy proceedings may follow, and notes at the end setting out the eighteen-day and three-week periods. Usually delivered by hand rather than posted, because the creditor needs to prove when it was served.
The deadline
18 days from service to apply to set the demand aside; 3 weeks before a petition becomes possible
Eighteen days from the date of service to apply to set the demand aside (Insolvency Rules 2016, rule 10.4(4)). Separately, three weeks from service before the creditor may treat you as unable to pay and petition (Insolvency Act 1986, s268(1)(a)). The two are different dates and only one of them is a deadline for you.
If you do nothing
Once three weeks have passed with the demand neither complied with nor set aside, the creditor may present a bankruptcy petition — provided the debt is unsecured, for a liquidated sum, and at or above the bankruptcy level of £5,000 (Insolvency Act 1986, ss267–268).
Compute your date
The rule above is what the law sets. Put in the dates on your own letter and it becomes a date.
How it escalates
- 01The creditor may present a bankruptcy petition on the ground that you appear unable to pay (Insolvency Act 1986, s268(1)(a)).
- 02A petition brings court fees and a deposit, usually added to what is claimed against you.
- 03A bankruptcy order affects bank accounts, credit, some professions and directorships, and is entered on a public register.
- 04The eighteen-day window to apply to set the demand aside closes on time and is not reopened by later payment talks.
How to respond
Everything below is procedure: what the application consists of, where it is filed and by when. What to say in the witness statement is a matter for a solicitor or a debt adviser.
Response types
- Apply to set the demand asideApplication to set aside the statutory demand (rule 10.4) · Insolvency (England and Wales) Rules 2016, rule 10.4 · Application notice supported by a witness statement, filed with the court named on the demand
- Pay, or show a payment madePayment of the debt in full, or a record of payment already made · Insolvency Act 1986, s268(1)(a)
- Secure or compound the debtAgreement with the creditor to secure or compound for the debt · Insolvency Act 1986, s268
Where and how
- Filing at the court office named on the demand — the filing date is what stops the compliance period; ask for a sealed copy.
- The court's electronic filing service, where the named court accepts one for insolvency applications.
- Royal Mail Signed For to the court, remembering that the filing date is when the court receives it.
- Ordinary post, which proves nothing about when it arrived.
What to attach
- The statutory demand itself, exhibited to the witness statement.
- The witness statement in support.
- The court fee, or an application for help with fees.
- Documents referred to in the witness statement.
What makes it count
The application counts when the court files it, within eighteen days of service. Talking to the creditor stops nothing: only payment, an agreement they accept, or a filed application changes what happens after three weeks.
Common questions
Is a statutory demand a court order?
No. A creditor can serve one without going to court and without permission. Its force is what it lets the creditor do afterwards: after three weeks with the demand neither complied with nor set aside, s268(1)(a) treats you as appearing unable to pay.
Does applying to set it aside stop the clock?
Yes. Rule 10.4 provides that the time for complying with the demand ceases to run on the date the application is filed with the court, subject to any order under rule 10.5.
The debt is under £5,000.
Section 267 requires the debt, or the aggregate of the debts, to be at or above the bankruptcy level — currently £5,000 — for a creditor's petition. A demand can still be served, but the threshold is a condition of the petition that follows.
Can I just ring the creditor and sort it out?
You can, and an agreement they accept can dispose of the matter. But talking does not extend the eighteen days for a set-aside application, which runs on regardless of what is being discussed.
Sources
Facts verified against the sources below on 10 September 2026.
- Insolvency (England and Wales) Rules 2016, rule 10.4 — application to set aside statutory demandofficial
- Insolvency Act 1986, section 268 — definition of inability to payofficial
- Insolvency Act 1986, section 267 — the creditor's petition and the bankruptcy levelofficial
- GOV.UK — Statutory demandsofficial