Last updated 2 October 2026 · Reviewed by the Claim Done team · Not legal advice

How to Recover an Unpaid Invoice in Australia

Someone owes you money and won’t pay. Here is the exact process for recovering an unpaid invoice in Australia — from the first formal step to tribunal proceedings.

Step 1: Send a letter of demand

A letter of demand is the usual first step before filing a claim. It formally puts the debtor on notice, states the exact amount owed, and gives them 14 days to pay.

The letter must cite the relevant legal obligation — the contract terms, the Australian Consumer Law, or applicable state legislation. Claim Done generates a professional letter of demand and delivers it by email.

Step 2: File a tribunal application (if ignored)

If the 14-day deadline passes without payment, file a claim with the relevant tribunal or court:

• New South Wales: Local Court — Small Claims Division (up to $20,000) or General Division (up to $100,000); NCAT hears consumer claims only
• Victoria: VCAT — goods and services disputes (small claim $15,000 or less)
• Queensland: QCAT — Minor Civil Disputes (up to $25,000)
• Western Australia: Magistrates Court (minor case claim up to $10,000; consumer/trader claim up to $75,000)
• South Australia: Magistrates Court (minor civil action up to $12,000; general claim up to $100,000)
• Australian Capital Territory: ACAT (up to $25,000)

Filing fees are paid directly to the tribunal or court and depend on the state and the claim amount. Claim Done prepares the full application for $97.

Step 3: Statutory demand (for company debtors)

If the debtor is a registered company (Pty Ltd, Ltd) and the debt is $4,000 or more, consider a statutory demand under s459E of the Corporations Act instead of (or in addition to) a tribunal application.

A statutory demand gives the company 21 days to pay or face wind-up proceedings. This is a far more powerful lever than a tribunal application for company debts. Claim Done prepares statutory demands for $97.

How long does debt recovery take?

• Letter of demand: 14-day deadline.
• Statutory demand: 21 days to comply. If ignored, winding-up application can proceed.
• Tribunal hearing: waiting times vary by state and forum (VCAT, for example, says to expect about 52 weeks from applying to a mediation or hearing).

What if you win at tribunal but they still won’t pay?

A tribunal order is enforceable as a court judgment. If the debtor ignores it, you can enforce it through the local sheriff’s office (seizure of assets), garnishee orders (direct deduction from bank accounts), or by registering the judgment on the debtor’s credit file.

Start your debt recovery — letter of demand

Step 2: Escalate to a tribunal or court if ignored

If the letter of demand is ignored or rejected, file a claim in the appropriate tribunal. Most unpaid invoice disputes under $100,000 are heard by a state tribunal or the local court (the Local Court in New South Wales, the Magistrates Court in Western Australia and South Australia). Waiting times and filing fees vary by state.

Step 3: Enforce the order

Once you have a tribunal order, the debtor must pay. If they refuse, enforcement options include:

• Garnishment order — once the order is registered with the court, the court can order the debtor's bank to pay you directly
• Wage garnishment — for individual debtors, a portion of their wages can be redirected to you
• Property charge — a charge can be registered over real property the debtor owns

For company debtors — use a Statutory Demand

If the debtor is a registered company and owes $4,000 or more, consider a statutory demand under s459E of the Corporations Act. This is the most powerful debt recovery tool against companies — failure to comply within 21 days creates a presumption of insolvency and allows you to file for winding up proceedings.

Time limits for recovering unpaid invoices

Do not delay — time limits run from the date the debt was due and payable.

Recover your unpaid invoice today — letter of demand from $49