Got a letter of demand? What to check before you respond
Updated 13 Nov 2026 · General information, not legal advice
A letter of demand is a formal request to pay money or do something by a deadline, usually with a warning that legal action may follow. It can be worrying, but it is a request, not a court order. What matters is what you do next.
Do not ignore it
Ignoring a genuine demand can lead to a court claim, extra costs and, if a court judgment is made against you, enforcement action and a mark on your credit history. Even if you think the claim is wrong, it is usually better to respond in writing.
Check that it is genuine
- Is the sender real? Look up the business or law firm yourself rather than using contact details in the letter.
- Do you recognise the debt or the claim? Scam letters and emails dressed up as debt demands are common. You can check current scams on Scamwatch (scamwatch.gov.au).
- Do not pay into an unfamiliar account, and do not give out personal or bank details, until you are sure.
Check the claim itself
- What exactly is claimed, how was the amount worked out, and what does it rely on (a contract, an invoice, an incident)?
- Do you have records that show something different: receipts, emails, photos or a contract?
- How old is it? Most debts have a limitation period set by state or territory law, after which the creditor may no longer be able to sue. It is commonly six years, but it varies, and some actions can restart the clock.
Responding
- If you are unsure whether you owe it, ask in writing for details and copies of the documents the claim relies on.
- If you dispute it, say so in writing and briefly explain why. Keep a copy of everything you send and receive.
- If you owe the money but cannot pay it all, ask for a payment plan in writing. Free financial counsellors can help: call the National Debt Helpline on 1800 007 007.
- Be careful about admitting liability or signing anything new until you understand the consequences.
If court papers arrive
A statement of claim or similar court document has strict time limits to respond. Get legal help straight away: the Legal Aid commission in your state or territory or a community legal centre can often help for free.
You can upload the letter (or a photo of it) to Legal Guide to get a plain-English explanation of what it says and a list of questions to ask.