How to Apply to NCAT for Unpaid Invoices Under $10,000

If a client or customer in New South Wales refuses to pay your invoice, you don’t need to hire a lawyer, but you do need the right forum. If you are the business that is owed money, an unpaid invoice is a debt claim for the Local Court of New South Wales, not the NSW Civil and Administrative Tribunal (NCAT). The Local Court’s Small Claims Division hears claims up to $20,000, and its General Division hears claims over $20,000 up to $100,000.

This guide explains why NCAT is usually the wrong place for an unpaid invoice, how to start a Local Court claim instead, what evidence you need, and what happens after you file.

Can You Take an Unpaid Invoice to NCAT’s Consumer and Commercial Division?

Usually, no. NCAT’s Consumer and Commercial Division hears consumer claims up to $100,000, and a consumer claim is a claim brought by a consumer about goods or services supplied to them (Fair Trading Act 1987, s 79E and s 79I). “Consumer” includes a natural person, a partnership and a small proprietary company (s 79D), so a business can bring a consumer claim when it is the buyer. A supplier chasing its customer for payment cannot.

Debt claims that belong in the Local Court include:

• Unpaid invoices for services rendered (trades, consulting, freelancing)
• Unpaid goods supplied (materials, products, equipment)
• Breach of contract where money is owed
• Unpaid fees for professional services

The exception is where your customer has lodged an NCAT consumer claim against you, for example alleging the work was defective. In deciding that claim, the Tribunal can order the claimant to pay you a specified amount (s 79O).

Before You File: Send a Letter of Demand

A letter of demand is the usual first step before a Local Court claim, and it often gets the invoice paid without one.

Your letter should:

• State the amount owed clearly
• Reference the invoice number and date
• Explain what goods or services were provided
• Give a deadline for payment (typically 7-14 days)
• State that you will start a claim in the Local Court if the debt is not paid

Keep proof that you sent the letter (email confirmation, Australia Post tracking, certificate of posting). You may need it later as evidence.

Step 1: Check Which Court Hears Your Claim

Before you file, confirm:

• The amount: up to $20,000 goes to the Local Court’s Small Claims Division; over $20,000 up to $100,000 goes to its General Division
• The debt relates to goods, services, or a contract
• Who exactly owes you: the correct person or company name
• You have evidence proving the debt (invoice, contract, proof of delivery)
• Whether the debtor disputes the debt, and on what grounds

If your claim is over $100,000, it goes to the District Court (up to $750,000).

Step 2: Gather Your Evidence

The court decides cases based on the evidence you provide. Prepare:

Essential documents:

• The original invoice(s)
• Proof of delivery or completion (photos, signed delivery dockets, emails confirming receipt)
• Any contract or agreement (quote, purchase order, terms and conditions)
• Your letter of demand and proof it was sent
• Correspondence with the debtor (emails, text messages, letters)

Supporting documents:

• Bank statements showing no payment received
• Photos or videos of the work completed or goods supplied
• Witness statements if someone can verify the work or delivery
• Business records (timesheets, supplier receipts, job notes)

Organise everything chronologically. Clear, well-structured evidence is easier for the court to follow.

Step 3: Prepare and File a Statement of Claim

A Local Court claim is started with a statement of claim, which can be filed through the NSW Online Registry. The registry’s guide explains how to file it.

Information you’ll need to provide:

• Your details (name, address, contact details, ABN if applicable)
• The defendant’s details (the person or company who owes you money)
• Amount claimed (the total debt including any interest)
• Brief description of the claim
• What you are asking the court to order (typically “payment of $X”)

Keeping your evidence ready:

Have your invoice(s), contract, proof of delivery, letter of demand and other key evidence organised before you file. You will need it if the customer defends the claim.

Step 4: Pay the Filing Fee

Filing fees change each financial year; check the current fee on the Local Court’s site before you file.

Step 5: Serve the Claim and Wait for a Response

Once filed:

1. The statement of claim must be served on the defendant
2. The defendant can pay, admit the debt, or file a defence
3. If the claim is defended in the Small Claims Division, it goes to a pre-trial review first

At the pre-trial review, a registrar, assessor or judge tries to help the parties agree. If the matter does not settle, it proceeds to a hearing.

Step 6: Prepare for the Hearing

Small Claims Division proceedings are less formal and less technical than other court proceedings, and the rules of evidence do not apply, but preparation matters.

What to bring:

• File and serve your written statements and documents by the dates the court sets at the pre-trial review, and bring your own copy of everything to the hearing
• A chronology (timeline of events)
• A list of the documents you’re relying on
• Written statements from any witnesses, filed as the court directs (witnesses are generally not called unless the court decides otherwise)

What to expect:

• The person hearing the claim will ask you to explain your case
• The defendant will have a chance to respond
• You may be asked questions about your evidence

Presenting your case:

• Speak clearly and stick to the facts
• Refer to your evidence by document number or date
• Avoid emotional language
• If the defendant makes claims you disagree with, respond calmly with evidence

Step 7: The Court Makes a Decision

The decision may be given on the day or later.

Possible outcomes:

• Judgment in your favour — the defendant must pay the amount ordered
• Judgment against you — the court finds the debt is not owed or the defendant has a valid defence
• Partial judgment — the court orders payment of part of the debt
• Dismissal — the claim is dismissed, for example for lack of evidence

A judgment is legally binding. If the defendant doesn’t pay, you can take enforcement action through the Local Court.

Step 8: Enforcing the Judgment

If the defendant ignores the judgment, you can enforce it by:

• Garnishee order — take money directly from their bank account or wages
• Writ of execution — seize and sell their property
• Examination notice — require them to complete a statement of their financial position (if that is not enough, the court can order them to attend for examination)

Each enforcement step is a separate application to the Local Court.

Common Mistakes to Avoid

Choosing the wrong forum — a business debt is not an NCAT consumer claim, so lodging it there risks a wasted fee and lost time. Unpaid invoices go to the Local Court.

Not sending a letter of demand first — it is the usual first step, it gives the debtor a clear deadline, and it is part of your evidence if you have to file.

Incomplete evidence — if you don’t have proof of delivery or completion, you may not be able to prove the debt. Always keep records.

Wrong defendant details — if you get the debtor’s name or address wrong, your claim may be against the wrong party or never reach them. Double-check company names on the ABN register or ASIC.

Claiming the wrong amount — only claim the amount you can prove. Don’t inflate your claim or include speculative damages.

Missing the hearing — if you don’t attend, you risk losing your claim. If you can’t attend, ask for an adjournment in advance.

How Claim Done Helps

Before you go to the Local Court, send a professionally drafted letter of demand ($49). Many debts are paid at this stage, saving you the court fee and hearing time.

Claim Done’s Programmatic Algorithms use what you tell us about your invoice, contract, and evidence to draft a clear letter setting out the debt and its legal basis. You approve it, then we deliver it to the debtor by email.

If the letter doesn’t work, Claim Done’s Tribunal Application ($97) drafts a Local Court statement of claim for a New South Wales debt from your answers and documents. You approve it, then file it yourself.

Final Checklist

Before you file your Local Court claim for an unpaid invoice:

• Send a letter of demand and wait for the deadline to pass
• Gather all invoices, contracts, and proof of delivery
• Confirm the amount and which division hears it (Small Claims up to $20,000; General Division over $20,000 up to $100,000)
• Prepare your statement of claim
• File it through the NSW Online Registry
• Pay the filing fee
• File and serve your evidence by the dates the court sets
• Attend the pre-trial review and hearing on time

The Small Claims Division is designed to be less formal than other court proceedings, but preparation is everything. Clear evidence, the right forum and a well-drafted claim put you in the best position to recover your unpaid invoice.

Start with a letter of demand through Claim Done’s automated service for $49, or if you’re ready to file, use our Tribunal Application service ($97), which drafts a Local Court statement of claim for a New South Wales debt.

Frequently Asked Questions

Can I take a customer to NCAT for an unpaid invoice?

Generally, no. A consumer claim at NCAT is brought by a consumer about goods or services supplied to them, so a business chasing its customer has a debt claim for the Local Court: the Small Claims Division up to $20,000 and the General Division over $20,000 up to $100,000. The exception is where your customer brings a consumer claim against you: the Tribunal can then order the customer to pay you.

Can I claim interest on the unpaid invoice?

Yes, if your contract or invoice terms allow for interest. The court can also award interest under New South Wales legislation from the date the debt was due. Calculate interest at the prescribed rate and include it in your claim.

What if the debtor is a company that has been deregistered?

You cannot pursue a deregistered company in court. Check the company’s status on the ASIC register. If it’s deregistered, you may need to apply to ASIC to reinstate the company before proceeding with your claim.

Do I need a lawyer for a Local Court small claim?

No. Small Claims Division proceedings are less formal and less technical, and you can run your own claim.

What happens if the customer doesn’t respond to my statement of claim?

If the defendant does not file a defence, you may be able to ask the court for judgment without a hearing (a default judgment). A defendant can apply to have a default judgment set aside, so keep your evidence until the debt is paid.