A letter before action is your last step before a court claim, and what it has to contain depends on something most templates ignore: whether you're chasing an individual or a company. If you're chasing a sole trader you're inside the Pre-Action Protocol for Debt Claims, with a prescribed pack and 30 days to reply. If you're chasing a limited company you're under the general Practice Direction instead, and it asks for much less.
The short version
- Paragraph 1.1 of the Pre-Action Protocol for Debt Claims covers a business claiming a debt from an individual, including a sole trader.
- Under that protocol your debtor gets 30 days to reply, and your letter goes out with an information sheet, a reply form and a financial statement form.
- Where your debtor is a company, the Practice Direction on Pre-Action Conduct applies instead, and it asks for a letter and a reasonable time to respond.
- If you ignore the rules that apply, the court takes that into account when managing the case.
- Sending one is a decision about your relationship with the customer as much as about the debt.
Two different rule sets
The Pre-Action Protocol for Debt Claims sets out its own scope in paragraph 1.1:
"This Protocol applies to any business (including sole traders and public bodies) claiming payment of a debt from an individual (including a sole trader)."
On the creditor side there's no restriction, so any business qualifies. The debtor side is narrower and catches people out: you need an individual, which includes a sole trader but not a limited company.
Where the protocol doesn't apply, the Practice Direction on Pre-Action Conduct and Protocols fills the gap. Its scope is equally plain: it "applies to disputes where no pre-action protocol approved by the Master of the Rolls applies."
| Who owes you | Which rules | Time to reply |
|---|---|---|
| A sole trader or individual | Pre-Action Protocol for Debt Claims | 30 days from the date at the top of the letter |
| A limited company | Practice Direction on Pre-Action Conduct | A reasonable time: 14 days in a straightforward case, up to 3 months in a very complex one |
Getting this the wrong way round has consequences in both directions. Send a bare two-line letter to a sole trader and you haven't complied with the protocol. Send the full protocol pack to a limited company and you haven't done anything wrong, but you've given a corporate debtor 30 days where 14 would have done.
Chasing an individual or sole trader
The protocol asks you for a Letter of Claim containing, among other things: the amount of the debt, whether interest or other charges are continuing, and details of the agreement. Where your agreement was oral, it wants to know who made it, what was said, and when and where. Where it was written, it wants the date, the parties, and confirmation that a copy is available. If you've assigned the debt, that has to be set out. And if instalments were offered and refused, your letter has to explain why.
Three documents go with it: an information sheet, a reply form, and a financial statement form, all from Annexes 1 and 2 of the protocol. You enclose an up-to-date statement of account as well.
On timing, paragraph 3.4 is specific:
"If the debtor does not reply to the Letter of Claim within 30 days of the date at the top of the letter, the creditor may start court proceedings."
The 30 days runs from the date on the letter, so if you date it a week before you post it you've given away a week.
Chasing a limited company
The Practice Direction asks less of you. Before you issue a claim, you write to the defendant with concise details: the basis on which the claim is made, a summary of the facts, what you want, and where money is claimed, how you calculated the amount.
The defendant is expected to respond "within a reasonable time". The Practice Direction puts that at 14 days in a straightforward case and no more than three months in a very complex one, and an unpaid invoice with a signed contract behind it is a straightforward case. The response is expected to say whether the claim is accepted, and where it is not, why, along with any counterclaim. Both of you are expected to disclose key documents relevant to the dispute.
What goes in either letter
The content you need is the same either way:
- Itemise the debt, with invoice numbers, dates, amounts and what you supplied.
- Set out the interest position: the rate, the date interest started to run, and the fixed sum. Between businesses that's a statutory entitlement, not a threat.
- Give the account history, so what you sent and when, and any response you got back.
- Say what you want and by when, as a specific sum and a specific date.
- Say what happens next. You'll issue a claim, and there's no need to decorate that.
- Give a route to resolve it, so how to pay, and an invitation to raise a dispute or propose instalments.
The tone that works is administrative, not adversarial. Your letter is a statement of position and a deadline. It doesn't need adjectives, and where your debtor is an individual, an aggressive letter sits badly next to a protocol built around giving them a fair chance to respond.
What happens if you skip it
Paragraph 7.1 of the debt protocol sets out what happens:
"If a matter proceeds to litigation, the court will expect the parties to have complied with this Protocol. The court will take into account non-compliance when giving directions for the management of proceedings."
Non-compliance is a case management consequence rather than a bar on claiming, but it's a poor position to put yourself in over a step that costs you a stamp.
Before you send it
There are two things to settle before the letter goes out, and what you find will shape how you word it.
Is the debt genuinely disputed, or simply unpaid? A dispute you haven't addressed is the strongest thing a defendant can bring to a hearing, so if a query was raised and you never answered it, answer it first, in writing.
And can your debtor actually pay? A letter before action to a business in real difficulty is likely to get you either silence or a proposal for instalments. Both of those are workable outcomes, and an instalment plan you agree and document is usually easier to live with than a judgment you then have to enforce.
There's also a commercial question underneath the legal one, because a letter before action usually ends the working relationship. Where your client is otherwise good and the invoice is one bad month, putting them onto a mandate for future work tends to be the more useful move. Where the relationship is already over, the letter is the right instrument, and it works better sent promptly than as a last gesture after a year of reminders.
Common questions
What is a letter before action? The final written warning before issuing a court claim. It sets out the debt, the interest position, what you want and by when, and states that you will start proceedings if it is not resolved.
How long do I give them to respond? Where the debtor is an individual or sole trader, the Pre-Action Protocol for Debt Claims gives 30 days from the date at the top of the letter. Where the debtor is a company, the Practice Direction on Pre-Action Conduct expects a reasonable time, which is 14 days in a straightforward case.
Does the debt protocol apply to a limited company? No. It applies where a business is claiming a debt from an individual, including a sole trader. Claims against companies fall under the general Practice Direction.
Do I have to send an information sheet and reply form? Under the debt protocol, yes: the information sheet, reply form and financial statement form go out with the Letter of Claim. The Practice Direction does not require them.
Can I still claim interest if I send a letter before action? Yes. Statutory interest and the fixed sum continue to apply on a business debt, and stating the position in the letter is usually more effective than adding small sums to earlier reminders.
What if they ignore it? Once the response period has passed you can issue a claim. Keep the letter, proof of sending and any reply, because the court will expect to see that the pre-action steps were followed.
Sources
- Ministry of Justice — Pre-Action Protocol for Debt Claims (accurate as of August 2026)
This article explains the pre-action steps before a court claim and is not legal advice. The protocols and court rules are updated from time to time, so check the current version before relying on a deadline. Last updated August 2026.
