What is statute-barred debt?

A statute-barred debt is not written off. The debt still exists, and the creditor can still ask you to pay. What it loses is the ability to get a court judgment against you, but only if you point out the time limit. That is why getting the dates right, and not making a payment in the meantime, matters so much.

How long before a debt becomes statute-barred?

Some debts follow different rules:

• Mortgage shortfall (money still owed after a home is repossessed and sold): 12 years for the capital and 6 years for the interest, in England and Wales.
• County court judgments: there is no time limit for enforcing a judgment once it exists. After 6 years the creditor needs the court’s permission to send bailiffs, and interest older than 6 years cannot be recovered. See satisfied and cancelled CCJs.
• Council tax (England and Wales): the council must get a liability order within 6 years of the tax falling due. Once it has one, there is no time limit on enforcing it.
• Tax and benefit debts have their own rules and powers that can apply without going to court. Get advice before assuming they are statute-barred.

When does the six years start?

Not simply from your last payment. The clock starts when the creditor’s “cause of action” arises, meaning the point it could first take you to court. For many credit cards and loans, that is after a default notice has been served and the date in it has passed. That can be months after your last payment.

Working out the date can be fiddly, especially after a debt has been sold. Ask the creditor for copies of the default notice and a statement showing the last payment, and let a debt adviser check the dates.

What restarts the clock?

In England and Wales, two things restart the six years, but only while the debt is still in time:

• A payment, of any amount, by you or someone on your behalf.
• A written acknowledgement that you owe the debt, signed by you.

A phone call does not count as an acknowledgement, because it must be in writing and signed. For a joint debt, a payment by either of you restarts the clock for both.

Once a debt is already statute-barred, it “shall not be revived by any subsequent acknowledgment or payment” (Limitation Act 1980, section 29(7)). So if a collector gets you to pay £1 on a debt that was already barred, that payment does not bring it back into time. The risk is paying when you are not sure of the dates. If the debt was not quite barred, the payment restarts the full six years.

Northern Ireland also restarts time on an acknowledgement or part payment, but the detail differs from England and Wales, so get advice there before writing or paying.

What can a collector do about a statute-barred debt?

It can still write to you. It cannot use the courts to force payment if you rely on the time limit. FCA rules also limit what firms can do:

• A firm must not pursue a statute-barred debt if the creditor made no contact with you during the limitation period (CONC 7.15.4R).
• A firm must not keep demanding payment once you have said the debt is statute-barred (CONC 7.15.8R).

If you believe a debt is statute-barred, write to the collector saying so, explaining why (for example, “I have made no payment or written acknowledgement for more than six years”), and asking it to stop contacting you. Keep a copy. Do not offer a payment “as a goodwill gesture” in the same letter. National Debtline’s statute-barred debt guide has a free template.

Old debts are often sold on or passed between collection agencies. A new name on the letter does not restart the clock. See dealing with debt collectors for your rights more generally.

What if you get court papers for an old debt?

Do not ignore them. The court does not check the time limit for you. Limitation is a defence you have to raise yourself, by responding to the claim by the date shown and giving details of when you say the time limit expired. If you do nothing, the creditor can get a county court judgment even on a debt that was out of time, and you would then have to apply to have it set aside, which costs money and is not guaranteed.

Before court, a business must send a Letter of Claim, and you have 30 days to reply. That reply form is the first place to say the debt is statute-barred. A free adviser can help you word it.

How is it different in Scotland?

In Scotland the rule is called prescription, and it is stronger. Most debts are extinguished after 5 years: the debt no longer exists at all, rather than just being unenforceable. The 5 years usually runs from when the debt became enforceable, or for a running account, when the last payment fell due.

It is interrupted by a “relevant claim” (such as court action or diligence) or a “relevant acknowledgement” (a payment that clearly shows the debt still exists, or a clear written admission). Court decrees last 20 years. For Scottish debt options more generally, see debt solutions in Scotland.

What do people commonly get wrong?

• “Six years from my last payment.” It runs from when the creditor could sue, often later.
• “It is in the Consumer Credit Act.” It is the Limitation Act 1980 in England and Wales.
• “Any contact restarts it.” Only a payment or a signed written acknowledgement does, and neither can revive a debt that is already barred.
• “A statute-barred debt is written off.” Not in England, Wales or Northern Ireland. It still exists; it just cannot be enforced in court if you raise the time limit. Our guide to writing off debt covers the routes that actually release you.

What to do next

1. Do not pay anything or sign anything about an old debt until you know the dates.
2. Ask the collector for the default notice date and a statement showing the last payment.
3. Get free, impartial help to check the dates and draft a letter: MoneyHelper, StepChange, Citizens Advice and National Debtline can all help. See where to get free debt advice.
4. If court papers arrive, respond by the deadline and raise the time limit. If several debts are still in time, debt solutions compared sets out your options.