Company · usually 21 days

Someone is trying to wind up your company.

Work out which document you have and what date it really gives you. Then read what voluntary administration does, and the part most people find out too late.

Read this before anything else

A company cannot represent itself.

Everywhere else on this site assumes you can stand up and speak for yourself. Here you generally cannot, because the party is not you. It is the company, and a company is a separate legal person that can only be heard through a lawyer.

Federal Court Rules 2011 (Cth) r 4.01(2): “A corporation must not proceed in the Court other than by a lawyer.” The Supreme Court rules in each state say much the same thing. A court can dispense with the requirement, in the Federal Court under r 1.34, but it does so sparingly, and being short of money is not on its own a reason that works.

This matters more than it sounds. A director who files a notice of appearance in the company’s name and turns up expecting to argue may be told the company has no one before the court, and the matter can proceed as though nobody appeared. If you are going to ask for leave to appear, ask for it in advance, in writing, with reasons, rather than discovering the problem at the bar table.

You can still do a great deal yourself. You can work out the deadline, gather the evidence, get the lodgements up to date, speak to a registered liquidator, and negotiate with the creditor. All of that is yours to do and most of it is more useful than anything that happens in the courtroom.

First, which one have you got

Two very different documents, and people mix them up

A creditor’s statutory demand

Form 509H. Addressed to the company. Demands payment of a stated debt within 21 days. Usually comes with an affidavit verifying the debt, unless the debt is a judgment debt.

What it is: Not a court case. Nothing has been filed. It is a formal demand for a debt of at least the statutory minimum, currently $4,000, and it is the step a creditor takes before applying to wind the company up.
Your clock: 21 days from service. The deadline to apply to set it aside is the one that cannot be extended by anybody. The period to comply can be extended, but only by a court order or by making that application.
What it sets up: If the company does not comply and does not get the demand set aside, it is presumed insolvent, and the creditor can apply to wind it up on that presumption alone without proving anything about its finances.

An originating process to wind the company up

Carries a court’s name, seal and a file number. Names the company as defendant. Has a hearing date on it. Often comes with an affidavit and a registered liquidator’s written consent to act.

What it is: A case. The 21 days, if there ever was a statutory demand, has already gone.
Your clock: The hearing date. To oppose, the corporations rules in each court require a notice of appearance in Form 4, and where the company was named in an originating process it must generally be filed and served not later than 3 days before the hearing.
And this is not optional: Under s 465C a person may not oppose a winding up application at all, without leave, unless within the prescribed period they have filed and served both a notice of the grounds of opposition and an affidavit verifying the matters stated in it. Turning up with an argument and no affidavit is not opposing the application.
Also happening: The applicant must publish notice of the application on ASIC’s published notices website. That is public. Banks, insurers and suppliers watch it, and it is often how everyone else finds out.

Worth knowing

A statutory demand is the common route but not the only one. A creditor can also apply by proving the company is actually insolvent, and there are other grounds entirely, such as a deadlock between shareholders. If you never received a statutory demand, that does not mean the application is defective.

Work out the real date

Count from the day it was served, not the date printed on it

This does the arithmetic and nothing else. It does not look at your debt, your books or your prospects, and it cannot tell you what to do. Nothing you type here is stored or sent anywhere.

Statutory demand deadline calculator

For a creditor’s statutory demand under the Corporations Act 2001 (Cth).

Date the demand was served on the company

Served means the day it reached the company’s registered office or was otherwise validly served, not the day someone opened it or forwarded it to you.

If the 21 days has already gone

You do not get to make the same argument later

This is the part people find out at the hearing. At the winding up, the company cannot rely on a ground it used in a set aside application, or a ground it could have used but did not. It makes no difference whether an application was ever made. A company that fought the demand and lost is caught by this just as squarely as one that did nothing.

Section 459S. Those grounds are available only with the court’s leave, and leave may only be granted if the court is satisfied the ground is material to proving that the company is solvent. So “this debt is disputed” is not enough on its own. You have to show that taking the disputed amount out actually makes the company able to pay its debts as and when they fall due.

That is a harder question than it sounds, and it is worth doing the arithmetic honestly before spending money on the argument. If the undisputed part of the debt is still several times what the company holds, then removing every disputed dollar does not change the answer, and the dispute is not material to solvency. It may well be worth pursuing, but somewhere else and by another route.

What section 459S does not take away

Proving the company is solvent. The presumption of insolvency is rebuttable. It operates except so far as the contrary is proved. Solvency is not a ground that could have been raised on a set aside application, so s 459S does not bar it, and a company that missed the 21 days can still defeat the application by proving it can pay its debts as they fall due.

That is a real defence and it is not an easy one. Courts expect the fullest and best evidence, which in practice means proper financial records, cash flow, and usually something more than the director’s assurance. If the records are not there, this route is not there either.

A different kind of argument

Saying the demand was never served at all is not the same as disputing the debt. It goes to whether there was any failure to comply, and so to whether the presumption ever arose. A company cannot have relied on a ground in an application it was never in a position to make. Note two things. The company carries the burden of establishing non-service, and there is a large body of case law on service that is not summarised anywhere quickly. And arguing about a defect in service, where the demand did reach the company, is a different argument and much more likely to be caught by s 459S.

Be clear about what winning it achieves. It removes the presumption. It does not end the case. The applicant can still prove the company is insolvent the ordinary way, on the figures. It changes who has to prove what, not what the figures say.

The court also has a general power to adjourn a winding up application, conditionally or unconditionally, under s 467(1)(b), and does so where there is a real prospect that an adjournment leads somewhere. Asking for time to do something specific works better than asking for time.

What is actually available

The options, and what each one costs you

These are the routes that exist. Which of them fits a particular company depends on facts nobody on a website knows, and choosing between them is exactly what you need a registered liquidator or a lawyer for.

Pay, or secure or compound the debt

s 459E(2)(c)

The demand goes away. Compounding means agreeing terms the creditor accepts, so this includes a payment arrangement if the creditor signs up to it inside the period.

Time: Inside the 21 days.
Watch for: Get it in writing before the period expires. A creditor saying “we’ll sort something out” on day 19 is not compliance, and negotiations do not stop the clock.

Apply to set the demand aside

ss 459G, 459H, 459J

Available where there is a genuine dispute about whether the debt exists or how much it is, where the company has an offsetting claim against the creditor, where a defect in the demand would cause substantial injustice, or where there is some other reason.

Time: 21 days, filed and served, no extensions.
The test: A genuine dispute is a low bar. The company does not have to prove it would win, only that the dispute is real and raised in good faith. An offsetting claim counts even if it comes out of a completely different transaction.
The maths: The court works out the substantiated amount, being the admitted debt less the offsetting claim. If that is under $4,000 the demand must be set aside. If it is more, the court can vary the demand down instead of killing it.
The trap: If you apply and lose, the compliance period becomes 7 days from the determination unless the court orders otherwise. Losing does not buy you time, it spends it.

Voluntary administration

Part 5.3A

The directors resolve that the company is insolvent or likely to become insolvent, and appoint a registered liquidator as administrator. Control passes to the administrator immediately. Full weigh-up in the next section.

Time: Can be done at any point up to the moment a winding up order is made, including days before the hearing. Once the order is made the directors lose the power entirely, and they also lose it if a provisional liquidator has been appointed, which can happen earlier on an interim application.
Effect on the case: The court is to adjourn a winding up application if the company is under administration and the court is satisfied that continuing under administration is in the creditors’ interests. That is a duty, but it is conditional, and somebody has to put evidence in front of the court to satisfy it.

Small business restructuring

Part 5.3B

The one people forget. Directors stay in control of the business while a restructuring practitioner helps put a debt plan to creditors. Designed for small companies and much cheaper than administration.

Eligibility: On the appointment day, total liabilities must not exceed $1 million, and a 7 year rule bars directors who have used restructuring or simplified liquidation before.
And then: Due employee entitlements must be paid and tax lodgements made before a plan is proposed, not before the practitioner is appointed. So a company that is behind on lodgements can still appoint, and catch up inside the proposal period. That is a genuine difference from the director penalty rules, which give you no such window.
Time: 20 business days to propose a plan, extendable once by up to 10 business days. Creditors then have 15 business days to vote.
Why it matters here: Appointing a restructuring practitioner is one of the things that can remit a director penalty notice, the same as appointing an administrator.

Creditors’ voluntary liquidation

Part 5.5

Closing the company down on your own initiative rather than waiting for the court to do it.

Why anyone chooses it: It stops further trading losses, it stops insolvent trading exposure accruing, and it can be neater and cheaper than a court winding up. If the company has no future, the argument for spending money resisting the application is thin.

Do nothing

s 459C(2)(a), s 459R

This is a choice with consequences, not the absence of one.

What follows: Presumption of insolvency, a winding up order, a liquidator appointed, directors out, and a liquidator whose job includes investigating whether the company traded while insolvent and whether anything should be clawed back. The presumption is rebuttable by proving solvency, but if the company could prove that, it would usually not be here.
One quirk: A winding up application must be determined within 6 months of being made unless the court extends for special circumstances, and it is dismissed automatically at the end of that period. Do not plan around it. Courts treat delay in winding up proceedings unsympathetically.

The question everyone asks

Voluntary administration, weighed honestly

Administration begins the moment the administrator is appointed. It is fast by design. The first meeting of creditors is convened within 8 business days, and the decision meeting within a convening period of 20 business days, or 25 if the administration starts in December or close to Easter, with the meeting held within 5 business days either side of the end of that period. At that meeting creditors choose one of three things: a deed of company arrangement, ending the administration and handing control back, or liquidation.

What it does for you

It stops almost everything at once. Proceedings against the company cannot be begun or continued without the administrator’s consent or the court’s leave, enforcement processes stop, and owners and lessors cannot simply take their property back.
It can stop the winding up. The court is to adjourn the application where continuing under administration is in the creditors’ interests.
It protects director guarantees while it runs. A guarantee of the company’s liability cannot be enforced against a director, or their spouse, de facto or relative, without the court’s leave.
A deed of company arrangement binds dissenting unsecured creditors. An unsecured creditor who voted against it is still bound as to its claim. You cannot achieve that by negotiating with creditors one at a time. It does not bind a secured creditor, or an owner or lessor of property, who did not vote in favour.
It stops insolvent trading exposure accruing. You are no longer the one incurring the debts.
It can save the business. Not the company necessarily, but the trading business, the jobs and the customer relationships.
It is quick. Weeks, not years, and the cost is knowable in advance.

What it costs you

You lose control immediately. The administrator runs the company. They can trade it, close it, or sell it, and they do not need your agreement.
It is not free and the fees come first. The administrator is personally liable for debts they incur and has an indemnity out of the company’s property that ranks ahead of most unsecured creditors. If there is little money, there may be nothing left for anyone else.
A major secured creditor can still act. A secured party with security over the whole or substantially the whole of the company’s property has a 13 business day decision period in which to enforce anyway.
The guarantee protection is narrower than it looks. It stops proceedings being begun, so it does not stay a claim already on foot. It covers directors and their close family, not other guarantors. And it ends when the administration ends, so a deed of company arrangement does not stop a creditor enforcing a personal guarantee afterwards.
It does not fix a lockdown director penalty notice. See below. This is the single most common and most expensive misunderstanding.
Creditors may just vote for liquidation. Administration is a decision point, not an outcome. If the administrator’s report says creditors do better in liquidation, that is usually where it goes.
It is public and permanent. It appears on ASIC’s record and on published notices. Financiers, insurers and suppliers see it.

The honest summary

Administration is at its best where there is a viable business trapped inside a company with a debt problem, and a realistic deed that pays creditors more than a liquidation would. It is at its worst as a way of buying three weeks. The cost is real, control is gone from day one, and if the numbers do not support a deed, it is an expensive route to the same liquidation.

The part that decides everything

Three protections, one set of facts

Safe harbour from insolvent trading, eligibility for small business restructuring, and getting a director penalty notice remitted by appointing an administrator are three separate regimes in three different places. They all look at the same two pieces of housekeeping: are employee entitlements paid, and are tax lodgements in. What differs, and what matters, is how much slack each one gives you.

Safe harbour

Lost where the company is failing to pay employee entitlements when due or to give documents required by taxation laws, but only where that failure is less than substantial compliance, or is one of two or more failures in the preceding 12 months. A court can also relieve in exceptional circumstances or in the interests of justice. One tidy slip is not fatal.

Small business restructuring

Entitlements and lodgements must be dealt with before a plan is proposed, not before the practitioner is appointed. So there is a cure window, and it is roughly the 20 business day proposal period.

Director penalty notices

The strict one. For PAYG withholding and GST, reporting within three months of the due day keeps the notice remittable by appointing an administrator or restructuring practitioner. Past that, the only way out is paying the company’s debt in full, and nothing you appoint will change it.

Lodging and paying are different things, and it is the lodging that decides this. You can lodge a return you cannot pay, and doing that keeps the doors open. The director who stopped lodging altogether to buy breathing room has narrowed all three, and on the third one the door closes permanently three months after each due date, whatever happens in court.

Superannuation changed on 1 July 2026. Payday Super replaced the quarterly superannuation guarantee charge statement regime, and with it the test for when a super director penalty becomes one you can only pay your way out of. Older quarters and newer liabilities are not governed by the same rule. Do not work this out from an article written before mid 2026, and do not assume the position is the same as for PAYG and GST. Ask the ATO or your accountant what applies to each period.

If there is one practical thing on this page, it is this. Before you spend money on anything else, get a printout of the company’s lodgement history: which returns are in, which are not, and the date each one was lodged against the date it was due. That single page changes which of the options above are actually available, and most directors have never looked at it.

What follows you personally

The company is not the only one at risk

Director penalty notices
The ATO can make a director personally liable for the company’s PAYG withholding, GST and superannuation guarantee charge. You get 21 days, and the period runs from the day the ATO posts the notice to the address registered with ASIC, not from the day you read it. Not receiving it is not a defence. If your ASIC address is an old accountant’s office, fix that today.
Lockdown versus non-lockdown
For PAYG withholding and GST, if the amounts were reported within three months of the due day, the penalty can be remitted by paying, appointing an administrator, appointing a restructuring practitioner, or the company beginning to be wound up. Reported later than that, the only way to remit it is to pay the company’s liability in full, and administration will not touch it. For superannuation the test changed on 1 July 2026 under Payday Super, so check the current rule for the period in question rather than assuming it matches PAYG.
Insolvent trading
A director can be personally liable to compensate for debts incurred while the company was insolvent, where there were reasonable grounds to suspect insolvency and the director was aware, or a reasonable person in their position would have been. Compensation is measured by creditors’ losses and is not capped. Civil penalties and disqualification are also available, and dishonesty makes it criminal.
Personal guarantees
Landlords, banks, equipment financiers and trade suppliers routinely take them. Administration pauses enforcement against directors and their close family, but only while it runs, and only where proceedings had not already begun. Find every guarantee you have signed and read it before you choose between the options above.
Your records
A liquidator investigates. Failing to keep proper financial records is itself a problem and, in an insolvent trading claim, the company can be presumed insolvent because of it. Whatever else happens, do not tidy anything up.

If the debt is actually in dispute

A statutory demand is not a way to resolve a disagreement

A demand is for a debt that is due and payable. It is not the forum for arguing about whether the work was done properly, whether a variation was agreed, or whether the other side breached first. Where there is a real disagreement, using a statutory demand to force the issue is the thing the genuine dispute ground exists to stop.

If that is your situation, two things are true at once. The 21 days still applies and still cannot be extended, so the application to set aside comes first. But the underlying commercial argument is usually better settled than litigated, and most of them are. Mediation is confidential, it is measured in weeks rather than years, and it can produce outcomes a court cannot order, such as revised terms, a staged payment, or continued supply.

Where to take that

Commercial and contract disputes are handled by Alternative Dispute Resolutions, which is part of the same group as this site. That is a mediation service, not a legal service, and it is not a substitute for getting the set aside application filed inside the 21 days.

This week

In order

Establish the service date and put the deadline in your phone twice
Once on the day itself and once a week before. Use the calculator above.
Check the company’s ASIC registered office address
Everything gets served there, including director penalty notices, and the clock runs whether or not anyone collects the post.
Get the lodgement history
Ring the accountant or log in to the ATO portal. You want each return, the date it was due, and the date it was actually lodged. Not whether the debt is paid, which is a different question. This one page determines what is available to you.
Collect every personal guarantee
Leases, finance, supplier credit applications. You are looking for your own signature.
Talk to a registered liquidator
Most will give an initial conversation at no charge, and they are the people who actually run administrations and restructurings. You can check whether someone is registered on ASIC’s register before you call.
Get a lawyer for anything that goes to court
See the top of this page. This is not a preference, it is a rule.

Free, and worth using

Where to get help that costs nothing

Small Business Debt Helpline

Free, independent financial counselling for small business, by phone. They deal with exactly this and they are not selling you an appointment.

1800 413 828 · sbdh.org.au

ASIC’s insolvency information sheets

Plain English guides for directors and creditors on administration, restructuring and liquidation, written by the regulator. Free, and more reliable than most of what a search will return.

asic.gov.au

The court registry

Registry staff cannot give legal advice and will tell you so, but they can confirm what has been filed, the hearing date, and what the rules require. That call removes most of the guesswork.

ASIC published notices

Where winding up applications and insolvency appointments are advertised. Check whether an application against your company has been published, and what date it gives.

publishednotices.asic.gov.au

Being straight with you

What this page is not

It is not advice about your company

It is a description of how the process works and what the deadlines are. Nobody here has seen your books, your demand or your guarantees, and nothing here assesses whether you have an answer to the debt.

Nobody here is acting for the company

Reading this does not engage anyone, and no one is going to appear. The deadlines remain the company’s and the directors’.

It is general and it is current at the date below

Thresholds and timeframes change. Check the figures against the Act and the current regulations before relying on them.

The one instruction on this page

If the company has been served with a statutory demand and the 21 days is still running, get advice now rather than after. Almost every good option on this page lives inside that period.

Where this comes from

Corporations Act 2001 (Cth) ss 459C, 459E–459J, 459P, 459R, 459S, 465C, 467(1)(b), 588E, Part 5.3A (ss 436A, 436E, 439A, 439C, 440A, 440B, 440D, 440F, 440J, 441A, 443A, 443E, 444D, 444J), Part 5.3B, ss 588G and 588GA.
Statutory minimum of $4,000 from 1 July 2021, Corporations Amendment (Statutory Minimum) Regulations 2021 (Cth).
On the 21 day period being incapable of extension: David Grant & Co Pty Ltd v Westpac Banking Corporation (1995) 184 CLR 265.
Federal Court Rules 2011 (Cth) rr 1.34 and 4.01(2); Federal Court (Corporations) Rules 2000 (Cth) r 2.9 and the equivalent rules in each state and territory.
Director penalty regime: Taxation Administration Act 1953 (Cth) sch 1 div 269, and the ATO’s published guidance on remission. The superannuation limb was changed by the Payday Super reforms commencing 1 July 2026.
Small business restructuring eligibility and timeframes: ASIC’s published guidance on Part 5.3B.

Checked 22 September 2026.