A proof of debt is the claim a creditor sends to the liquidator or administrator of a company that owes it money. It is how you claim money from a company in liquidation: without one, you are usually left out when the money is paid out. Sending one costs nothing and you do not need a lawyer.
Is there an official form?
Not one you have to use. Since the Insolvency (England and Wales) Rules 2016, any document that contains the details below counts as a proof. Most liquidators and administrators send creditors their own proof of debt form, or have an online creditor portal, and using theirs is the quickest route. If you have not received one, write your own from the template below.
What a proof of debt must contain
Rule 14.4 of the 2016 Rules sets out what the claim has to say:
- Your name and address, and if you are a company, which company (its name and registered number).
- The total amount owed, including VAT, on the date the company went into liquidation or administration, less any payments or credits since.
- Whether that amount includes interest that has not been added to the account.
- How and when the debt arose: what you supplied, and when.
- Any security you hold, the date it was given and what you think it is worth.
- Any retention of title over the goods the debt is for.
- The documents that prove the debt, such as invoices, the order or contract, and a statement of account.
- The date, and a signature or other authentication. If someone signs for the creditor, their name, address and authority to sign.
A template you can copy
Proof of debt
- Company in liquidation or administration: name and Companies House number
- Creditor: your name or company name, and company number if you are a company
- Creditor's address:
- Amount claimed, including VAT, at the date of liquidation or administration: £
- Does this include interest not yet added to the account? Yes or no, and how much
- How and when the debt arose: for example, goods supplied between 1 March and 30 June, invoices 1041 to 1063
- Security held: none, or the details, date and value
- Retention of title: none, or the clause and the goods it covers
- Documents that prove the debt: list them, and attach copies
- Signed: name, position, and authority to sign for the creditor
- Date:
What to attach
Strictly, you only have to list the documents, and the office-holder can ask for them. Attaching copies from the start saves a round of letters: the unpaid invoices, a statement of account showing what is outstanding, the order or contract, and your terms of sale if you claim retention of title or interest.
Where to send it, and by when
Send it to the liquidator or administrator named in the appointment notice in The Gazette. Check the company by name or number to find the notice and the date. Most office-holders accept a proof by email or through their portal.
There is no deadline to send a proof as such, but there is one for each payout. Before paying a dividend, the office-holder publishes a notice of intended dividend in The Gazette and writes to known creditors with a last date for claims. A proof that arrives after that date misses that dividend. Send yours as soon as you know about the insolvency.
Small debts of £1,000 or less
If the company owes you £1,000 or less, the office-holder can include you in a dividend without a formal proof. The notice of the dividend will say what the company's records show you are owed; if you do not dispute it, that amount counts as proved. If the figure is wrong, reply with a proof for the right amount.
If your claim is rejected
The office-holder can accept the claim in full, accept part of it or reject it, and must tell you why. If you disagree, you can apply to the court to reverse the decision within 21 days of being told.
What you can expect back
An unsecured supplier is paid after the costs of the insolvency, any secured creditors and the preferential creditors, so the dividend is often a few pence in the pound and sometimes nothing. The office-holder's progress reports say what to expect. The full sequence, from confirming the insolvency to recovering the VAT, is in what to do when a customer goes into liquidation.
To hear about the next customer before the liquidator's letter does, put your accounts on insolvency alerts: you get an email the day a petition, administration or liquidation notice names one of them.
General information about the law of England and Wales, not legal advice. Scotland and Northern Ireland have their own rules for some of these steps.