Unpaid Invoice From a Company Ignoring You: Statutory Demand or Tribunal?

You’ve done the work. You’ve sent the invoice. You’ve followed up politely, then firmly. Now you’re being ignored completely.

When the debtor is a registered company — not a sole trader or individual — you have access to one of the most powerful debt recovery tools in Australian law: the statutory demand. But it’s not always the right choice. Sometimes tribunal action is faster, cheaper, or more appropriate.

What is a statutory demand?

A statutory demand is a formal notice served on a registered company (Pty Ltd or Ltd) that owes you $4,000 or more. The demand gives the company 21 days to pay the debt in full, secure or compound it to your reasonable satisfaction, or apply to court to set it aside.

If the company does none of these, you can apply to wind up the company — forcing it into liquidation proceedings.

Why it’s powerful:

• Directors take it seriously because it threatens the company’s existence
• Winding-up proceedings appear on ASIC records
• It shifts the burden: the debtor must act or face consequences
• It’s faster than tribunal action for large debts

Why it’s not always appropriate:

• Only works against registered companies (not sole traders, partnerships, or individuals)
• Minimum debt threshold is $4,000
• The debt must be undisputed and for a fixed amount
• If the company genuinely disputes the debt, the court will set aside the demand
• Costs escalate if you proceed to wind-up proceedings

What is tribunal action?

Tribunal action means filing a claim in your state’s civil and administrative tribunal: VCAT (Victoria), QCAT (Queensland), SACAT (South Australia), or Magistrates Court Small Claims (Western Australia, Tasmania, the Northern Territory, the Australian Capital Territory). In New South Wales a business debt goes to the Local Court, not NCAT: the Small Claims Division up to $20,000 and the General Division over $20,000 up to $100,000.

Tribunals typically handle disputes up to $10,000–$25,000 depending on the state. The process is designed to be accessible without a lawyer.

Why it’s appropriate:

• Works against any debtor: companies, sole traders, individuals
• Lower cost to file (typically $100–$500)
• No minimum debt threshold
• The tribunal can hear disputed facts and make a determination
• You get a legally enforceable order at the end

Why it’s slower:

• Waiting times for a hearing vary by tribunal
• The other party can file a defence
• You need to prove your case with evidence
• Enforcement is a separate step after you win

When to use a statutory demand

1. The debtor is a registered company

Check the company name on ASIC’s register. If it ends in Pty Ltd or Ltd and has an ACN, it’s eligible. Sole traders, partnerships, trusts, and individuals are not.

2. The debt is $4,000 or more

This is the statutory minimum. If the debt is less, use tribunal action or a letter of demand instead.

3. The debt is undisputed

The debt must be a specific amount owed under an invoice, contract, or loan agreement. If the debtor has raised a genuine dispute about the work quality, the amount, or whether the debt exists at all, a statutory demand is not appropriate.

4. You want immediate pressure

A statutory demand gives the company 21 days to act. If they ignore it, you can file wind-up proceedings, and if you do so within 3 months, the court must presume the company is insolvent. This timeline is faster than waiting for a tribunal hearing.

5. The company is solvent but unresponsive

Statutory demands work best when the company has assets and simply doesn’t want to pay. If the company is already insolvent, winding it up may not recover your money — you’ll be one creditor among many.

6. You’re prepared to escalate

If the company ignores the demand, you need to be ready to file wind-up proceedings or negotiate. A statutory demand is not a bluff.

When to use tribunal action instead

1. The debtor is a sole trader or individual

Statutory demands only work against registered companies. If you’re chasing a sole trader, partnership, or individual, tribunal action is your only option.

2. The debt is under $4,000

Below the statutory demand threshold, tribunal action is the most cost-effective path. Filing fees are low, and you don’t need a lawyer.

3. The debt is genuinely disputed

If the debtor claims the work was defective, incomplete, or not as agreed, the tribunal can hear evidence from both sides and make a determination. A statutory demand will be set aside if there’s a genuine dispute.

4. You want a judgment you can enforce

Tribunal orders are enforceable through the court system. Once you have an order, you can use enforcement methods like garnishee orders, writs of execution, or bankruptcy notices. A statutory demand doesn’t give you a judgment — it’s a precursor to wind-up proceedings.

5. The debt is small relative to the cost of wind-up proceedings

If the debt is $5,000 and the company ignores your statutory demand, you’ll need to file wind-up proceedings in the Federal Court or Supreme Court. The filing fee alone is typically $1,600–$2,000. Tribunal action is cheaper and more proportionate for smaller debts.

6. You’re not ready to wind up the company

A statutory demand is a serious threat. If you’re not prepared to follow through with wind-up proceedings, don’t issue one.

Cost-benefit comparison

For a $6,000 unpaid invoice from a Pty Ltd company that’s ignoring you, a statutory demand is faster and cheaper than tribunal action — if the debt is undisputed.

For a $3,000 unpaid invoice from a sole trader, tribunal action is your only option.

For a $15,000 unpaid invoice where the company claims the work was defective, tribunal action is more appropriate because the tribunal can hear evidence and decide the dispute.

How Claim Done helps with statutory demands

Claim Done prepares your statutory demand in Form 509H with a supporting affidavit template, for you to check, sign and serve on the company yourself.

What you get:

• Statutory demand drafted by our Programmatic Algorithms, citing the debt, invoice details, and relevant provisions
• Supporting affidavit template for you to swear before a JP or solicitor
• Service instructions for complying with legal requirements
• Guidance on next steps if the company ignores the demand

What you do:

1. Complete a 5-minute intake form with your invoice and company details
2. Review the drafted demand and affidavit
3. Swear the affidavit before a JP or solicitor
4. Arrange service on the company (registered office or director’s address)
5. Wait 21 days for the company to respond

Cost: $97 flat fee. No subscription. Prepared in about 5 minutes.

Claim Done does not handle Federal Court or Supreme Court litigation.

How Claim Done helps with tribunal applications

Claim Done drafts your tribunal application and a witness statement for your state’s tribunal. You attach your own evidence and lodge it yourself.

What you get:

• Application drafted by our Programmatic Algorithms, citing relevant consumer law, contract law, or state legislation
• Witness statement template if required
• State-specific filing instructions

What you do:

1. Complete a 5-minute intake form about the unpaid invoice
2. Tell us what evidence you have (invoice, contract, correspondence, proof of delivery)
3. Review the drafted application
4. File it with your state tribunal and pay the filing fee
5. Serve the application on the debtor
6. Attend the hearing (in person or by phone in most states)

Cost: $97 flat fee. No subscription. Prepared in about 5 minutes.

Claim Done does not represent you at the hearing; it drafts the application for the tribunal you name, and you attach your own evidence and lodge it yourself.

What to do right now

If a company owes you $4,000 or more and is ignoring your invoices:

1. Check the company is registered — search ASIC’s register for the ACN
2. Confirm the debt is undisputed — review any correspondence from the debtor
3. Calculate whether wind-up proceedings are proportionate — consider the debt size vs escalation costs
4. Prepare your statutory demand using Claim Done
5. Serve it correctly on the company’s registered office or director’s address

If the debtor is a sole trader, the debt is under $4,000, or the debt is genuinely disputed, file a tribunal application for unpaid invoices instead.

Both tools are powerful. The right choice depends on who owes you money, how much they owe, and whether they’re disputing the debt.

Company ignoring your invoice?

Claim Done prepares your statutory demand in Form 509H with a supporting affidavit — drafted by our Programmatic Algorithms, ready in about 5 minutes for you to check, sign and serve yourself.

Prepare your statutory demand now — $97 flat fee, no subscription, Australia-wide.

Prefer tribunal action? Claim Done drafts your tribunal application and a witness statement for your state tribunal.

Start your tribunal application — $97 flat fee, no subscription, all states.

Frequently Asked Questions

Can I issue a statutory demand to a sole trader?

No. Statutory demands only apply to registered companies (Pty Ltd or Ltd). For sole traders, partnerships, or individuals, use tribunal action or send a formal letter of demand first.

What happens if the company disputes my statutory demand?

The company has 21 days to apply to the court to set aside the demand. If they can show a genuine dispute about the debt, the court will set it aside. This is why statutory demands only work for undisputed debts with a fixed amount.

Is a statutory demand cheaper than tribunal action?

Upfront, yes — Claim Done prepares a statutory demand for $97 vs tribunal filing fees of $100–$500. But if the company ignores the demand and you proceed to wind-up proceedings, court filing fees start at $1,600 plus legal costs. For debts under $10,000, tribunal action is usually more cost-effective overall.

How long does a statutory demand take to work?

The company has 21 days to respond after service. If they ignore it, you can file wind-up proceedings immediately. Tribunal waiting times from filing to hearing vary.

Can I use both a statutory demand and tribunal action?

Not simultaneously for the same debt. If you issue a statutory demand and the company disputes it, you may need to pursue tribunal action instead. If you already have a tribunal judgment, you don’t need a statutory demand — you can enforce the judgment directly.