A Guide to Making a Money Claim Through the Small Claims Court

If you believe that a person or business owes you money, you may need to make a claim. The best way to do this for money claims up to £10,000 is through the small claims court.

What counts as a small claim?

People often talk about the ‘small claims court’ as though it’s something that you could bump into on the way to the shops. But there’s no such place as ‘the small claims court’. Instead, it just refers to the procedure that small claims go though.  

So, what is a small claim?

A small claim is a damages case for up to £10,000. It will also usually be a simple case to resolve, typically taking less than a day to go through.  

What are the benefits of the small claims court?

Making a claim though the small claims court has many advantages.

First and foremost, you don’t need a lawyer. This is important when you’re making a small claim as the cost of legal fees may not cover any damages that you’re awarded.

Most lawyers won’t take your case on if you’re claiming up to £10,000 – any damages you win are unlikely to cover their legal fees. Equally, there’s no point in you putting yourself though the hassle of legal action if you’re going to end up out of pocket.

The small claims court is a way of claiming the money you’re owed without needing legal help. You can easily apply online by yourself. And you get to keep everything if you win your case.

Another benefit of making a small claim is that many cases go undefended, which means you could win without having to do anything.

What can I make a claim for?

You can make a small claim for most breach of contract issues – like a breach of contract, the non-return of a tenancy deposit, or the sale of faulty goods. However, remember that winning your case isn’t guaranteed.

The process is the same whether you’re suing an individual or a company.

How much can I claim in a dispute over money?

Since large sums of money tend to complicate cases, there’s an upper limit to the amount you can claim in the so-called ‘small claims court’.

  • £10,000 in England and Wales

  • £5,000 in Scotland

  • £3,000 in Northern Ireland

If your claim is above the threshold, it’s possible that you won’t be able to make a small claim and must attend a formal hearing instead. Alternatively, you could just lower your demand to meet the limit.

Remember, you can only make a claim if the problem happened in the last six years.

When should I make a claim?

You don’t want to start by launching legal action. Taking a case to court should be a last resort, especially over small financial disputes.

In fact, the court will want to see evidence that you attempted to settle the dispute prior to taking them to court, giving the other party ample time and opportunity to resolve the issue. Not doing so could seriously harm your case.

In the first instance, write a letter or email outlining your dispute. Be sure to mention that you’re considering taking the person or business to court, too. Keep a copy of this letter and retain proof of postage if you’re mailing it in.

Make sure to include:

  • Your name and address

  • An outline of the situation

  • Your expectations for resolution – this might be repayment, replacement, etc

  • How much you believe you’re owed

  • How you settled on that amount

  • A deadline for resolution – this is usually 14 days, but depending on the dispute, you may be feeling more generous

If the other party fails to tackle the problem or disagrees with your version of events, then it’s time to act.

How do I make a claim over a financial dispute?

For residents in England and Wales, the quickest and easiest way to make a claim is by using the government’s online ‘Make a money claim’ form. This should only be used when you’re asking for a specific amount. If you don’t know the exact money owed, you must download, print, and complete the N1 form.

Since making a claim means paying a fee (we’ll get to that shortly), you won’t be able to use this service if you’re a low-income applicant as you may not have to pay any fees.

You also can’t make an online claim if it’s against more than one person or organisation. If the dispute involves two people or companies, use HM Courts & Tribunal Service’s Money Claim Online, which is for claims between £10,001 and £100,000. For financial disputes against three or more parties, you’ll need to complete the paper N1 form.

Should I try mediation during a money dispute?

Once you begin your small claim, you could be offered mediation. It’s optional, although it could help you resolve the dispute in an agreeable manner. This is offered by the Civil Mediation Council – a wholly independent and neutral organisation that gives information (but not advice) about the law and the options available to both parties.

According to the organisation, during mediation ‘offers can be made without influencing what happens if the dispute is eventually resolved in court (known as offers made ‘without prejudice’) which can enable participants to try to reach a settlement without compromising their position.’

Should an agreement be reached, a binding document is drawn up and signed. If the claim is already in court, a consent order is then sent to show agreement from both parties.

How much does a money claim cost?

The first thing to say about the costs involved in a small claim is that it won’t cost you anything if you win your case. But you must pay an upfront fee to get your claim processed.

How much you’ll pay to make a claim for disputes over money depends on two factors – how much the claim is for and how you’re making the claim. The only exception is if you don’t fill in the ‘amount claimed’ section of the form. In that case the fee is £10,000, so it’s not something you’ll want to leave out.

Think carefully about how much money you claim for. If you lose your case, you won’t get the fee back.

Money dispute claims fees:

  • Up to £300

Paper form: £35
Online form: £25

  • £300.01 - £500

Paper form: £50
Online form: £35

  • £500.01 - £1000

Paper form: £70
Online form: £60

  • £1000.01 - £1500

Paper form: £80
Online form: £70

  • £1500.01 - £3000

Paper form: £115
Online form: £105

  • £3000.01 – £5000

Paper form: £205
Online form: £185

  • £5000.01 - £10,000

Paper form: £455
Online form: £410

Additional fees may be payable if the claim requires a court hearing or further action is needed to resolve the financial dispute.

What happens after I’ve made a claim?

After you put in a claim against a person or organisation, they’ll have 14 days to respond. They might also send an acknowledgement of service, which gives them a further 14 days to dispute the claim.

They could pay up without question, update your online claims form or email Money Claims with the payment details. When using a paper form, you’ll need to directly inform the court.

If you don’t receive a reply, you can then request a ‘judgement by default’. For claims of a specified amount, use form N225; for unspecified amounts, use form N227. Should the court agree, it’s possible to win without further action.

The person or business might also make an offer, telling the court they’re willing to pay some or even all the money – you’ll be notified about this, with details on how to accept the offer.

On the other hand, they may dispute your claim. At this point, you’ll probably have to attend a hearing at county court. To prepare for the case, the court will send you Directions Questionnaire.

Essentially, it lets you say ‘Yes, I agree to a hearing to resolve this financial dispute’. Regardless of whether you agree, though, you’ll still need to fill in the form. 14 days before the hearing is set, any evidence you have should be submitted.

If the judge awards you the claim, they’ll usually give the defendant a month to pay the amount. However, you can disagree with the ruling (likely, the amount awarded) and request an appeal. But it’s worth remembering that even on appeal, you may not get back everything you believed you’re owed.

Do I need a solicitor to begin making a claim?

The small claims court process is designed to allow you to make simple claims by yourself. So, you probably don’t need a solicitor.

Furthermore, it’s likely that any damages you’re awarded won’t cover the legal fees of a solicitor, so it wouldn’t be worth it in most cases.

However, if you do decide that you want some legal advice, try to find low cost legal help. Just make sure that any legal fees you pay will be less than the compensation you could win.

You can us our quick quote form to compare costs for solicitors near you.