Are you in arrears with payments to a credit card, store card, personal loan or catalogue?
If you are, and you haven’t been able to agree on repayment terms, the company may decide to take further action that can lead to bankruptcy proceedings.
If a creditor sends you a Statutory Demand, this is a formal legal document that requires you to agree a repayment plan with them, or else they can start bankruptcy proceedings against you. You may apply within 18 days to your local County Court to “set aside” the Statutory Demand under the following circumstances:
- There is a dispute regarding the amount of money owed
- The sum owed is less than £750
- The demand has been issued in error
- You are able to pay the debt
- There is a Counterclaim of more than the money owed
Ignoring a Statutory Demand will allow the creditor to present a petition for bankruptcy against you 21 days after the date of the statutory demand.
Some companies use the issuing of a statutory demand as a tactic to frighten debtors but they should always be taken seriously. In particular a statutory demand issued for VAT by the HMRC should be regarded as putting its recipient in extreme financial danger.
More information on Bankruptcy
For immediate and free debt advice please call PayPlan free on 0800 280 2816 or use our Debt Help Form to submit your debt problem online.