Debt Recovery in Ireland: Your Options When a Client Won’t Pay
Unpaid invoices are one of the most common legal problems faced by Irish businesses. The good news is that Irish law provides several effective mechanisms to recover debts — the key is choosing the right one for the amount and circumstances.
Step 1 — Solicitor’s Letter Before Action
A formal letter from a solicitor stating the amount owed, the legal basis for the debt, and the consequences of non-payment resolves a significant proportion of debt disputes without further action. The cost is low and the success rate is high, particularly where the debtor has not disputed the debt.
Small Claims Court — Debts Up to €2,000
For business-to-consumer debts up to €2,000, the Small Claims Court offers a fast, cheap procedure without the need for legal representation. An online application costs €25. The process is designed to be accessible to non-lawyers.
District Court — Debts Up to €15,000
Debt claims up to €15,000 are processed in the District Court. A solicitor can issue proceedings relatively quickly and in straightforward cases (where the debt is not disputed) a judgment can be obtained without a full hearing.
Circuit Court — Debts Up to €75,000
Claims between €15,000 and €75,000 are heard in the Circuit Court. The process is more formal and typically requires legal representation. Summary judgment (without a full trial) may be available for undisputed debts.
Enforcing a Judgment
Obtaining a judgment is only the first step — you then need to enforce it. Enforcement options include: examination of the debtor (court order requiring disclosure of assets), attachment of earnings (deducting from salary), seizure of assets by the Sheriff, and judgment mortgage (registering against the debtor’s property).
Frequently Asked Questions
How long do I have to chase a debt in Ireland?
The statute of limitations for a simple contract debt is 6 years from the date the debt became due. For debts acknowledged in writing or partially paid, the 6-year period restarts. Acting promptly is always advisable.
Can I charge interest on overdue invoices in Ireland?
Yes — under the European Communities (Late Payment in Commercial Transactions) Regulations 2012, you are entitled to charge statutory interest on late commercial payments at 8% above the ECB reference rate. Your contract may also specify an interest rate.
What is a statutory demand in Ireland?
A statutory demand is a formal written demand under the Companies Act 2014 served on a company requiring payment of a debt exceeding €10,000 within 21 days. Failure to pay can be used as evidence that the company is unable to pay its debts — a ground for winding up.
This article is for informational purposes only. View our debt recovery letter service or speak to a solicitor.
