You may recall that last year, there was a temporary adjustment to the minimum debt threshold from which a creditor could issue a Creditor’s Statutory Demand (“CSD”) against a company. Last year the threshold was lifted from $2,000 to $20,000 in order to provide some breathing space for creditors during the heights of the COVID-19 pandemic and the amendments expired on 31 December 2020, meaning the threshold reverted to $2,000.

In the personal insolvency space, the comparable process is called a Bankruptcy Notice, and as I reported in January this year, its debt threshold was permanently increased from $5,000 to $10,000, effective 1 January 2021.      

Effective from 1 July 2021, the CSD threshold has followed suit (to some degree) and has been permanently doubled from $2,000 to $4,000.

For context, there was some debate about where to set the threshold, including matters that were addressed in The Treasury’s consultation process publications, including:

  • The effects of inflation: according to the RBA’s inflation calculator, the value of a basket of goods valued at $2,000 in 1992 would be worth $3,878 in 2020
  • Periodic indexation of the threshold: which could create confusion and lead to out of date information being relied upon when preparing a CSD
  • Commercial costs of issuing and defending a CSD: debts around the threshold of $2,000 are borderline uncommercial and impractical to both issue and defend    
  • Alignment with the CSD and Bankruptcy Notice thresholds: which were aligned for some time until the Bankruptcy Notice threshold was lifted initially to $5,000 in 2010 and more recently, $10,000 as mentioned above    

In practice, most debts will be well above the new threshold; however it is worth keeping this information in mind when advising your clients of their debt recovery options.

About the author

Greg Quin is a Partner and Registered Liquidator at HLB Mann Judd Insolvency WA and has been with the team for 12 years. Greg oversees the daily operations of the many insolvency appointments managed by the HLB Insolvency team and looks after the operations of the practice.

If you have any queries about insolvency matters, please feel free to contact Greg on 08 9215 7900, 0402 943 091 or via email to


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