Short answer: A limited company’s debt is usually the company’s alone. A director is only personally liable if they signed a valid personal guarantee or similar undertaking. Check your credit application and terms for a signed guarantee before assuming anyone else can be pursued.
A personal guarantee unpaid invoice question usually surfaces when a UK limited company has stopped paying and someone wonders whether a director’s home or savings can be chased. Often the answer is no — unless a signed personal guarantee (or similar personal undertaking) actually exists. The fee is 15% of what is recovered, payable only when you have been paid. Recovery is not guaranteed.
Debt Collection UK (a trading style of PASECOM GROUP LTD) introduces B2B files to independent partner agencies. We are not solicitors, we are not authorised by the Financial Conduct Authority, and we do not collect consumer credit. PASECOM GROUP LTD was incorporated on 7 April 2026. We introduce commercial claims; we do not issue proceedings. Partners collect. Recovery is not guaranteed.
This article explains when a director or personal guarantee can matter for unpaid B2B invoices, how company liability differs from personal liability, how to check whether a PG exists, and how to instruct on a clear company debt versus a separate guarantee claim. Money pages: corporate debt recovery and business debt collection.
Is company debt usually only the company’s debt?
When a company is registered, it becomes a body corporate in its own name under the Companies Act 2006, section 16. For a limited company, the liability of members is limited by the constitution — typically limited by shares — as set out in section 3.
In ordinary trade, that means an unpaid invoice issued to Ltd or PLC is a claim against the company, not against the directors personally just because they manage the business. GOV.UK’s Being a company director guidance explains directors’ filing and general duties; it does not turn every unpaid supplier invoice into a personal debt of the people named at Companies House.
Related reading: how to recover unpaid invoices from a limited company and what to do when a limited company ignores a final demand.
When can a personal guarantee matter?
A personal guarantee is a contractual promise by an individual (often a director or shareholder) to pay if the company does not. It is not created by the fact of being a director. It usually appears as a signed guarantee deed, a guarantee clause in credit terms the individual signed personally, a director’s undertaking, or sometimes a joint and several liability wording that clearly binds a named person.
A personal guarantee can matter when:
- 1. You hold a signed guarantee that covers the unpaid balance (or a defined facility).
- 2. The guarantee is still in force for that debt and has not been released in writing.
- 3. You can identify the guarantor and serve pre-action correspondence on them as well as (or instead of) chasing only the company.
- 4. The company is slow, insolvent-looking, or simply not paying, and the guarantee is your secondary route.
If you have no signed personal undertaking, do not threaten personal liability in credit-control emails. That can damage the relationship and misstate the legal position. Stay calm and stick to the company’s invoice trail.
How do you check whether a personal guarantee exists?
Before you change strategy, search your own file:
- 1. Credit application and account-opening pack (who signed, and in what capacity — “for and on behalf of the company” vs personally as guarantor).
- 2. Terms and conditions and any separate guarantee schedule or deed.
- 3. Emails where someone offered a personal guarantee in writing and you accepted it (keep the chain).
- 4. Variations, releases, or novations that may have ended the guarantee.
Companies House confirms the company’s legal name and officers; it does not list ordinary trade personal guarantees. Use Find and update company information to confirm the debtor entity, then rely on your contract file for any PG.
If the file is disputed — quality, quantity, or set-off — resolve or narrow that first. See disputed commercial invoices: when collection should pause.
What are proportionate next steps on the company debt?
For a clear company invoice, stay proportionate:
- 1. Soft reminders with proof of delivery or completion.
- 2. A clear statement of account and a short payment-plan window if cash flow is the issue.
- 3. A letter before action that follows Practice Direction – Pre-Action Conduct and Protocols for company-versus-company claims — set out the claim, invite a written response, and allow a reasonable time (often about 14 days in a straightforward case).
- 4. Then instruct a partner or take court advice. GOV.UK explains how to make a court claim for money; we do not issue claims for you.
More detail: letter before action for business debts and corporate debt recovery.
On qualifying commercial debts, statutory interest and fixed compensation under the Late Payment of Commercial Debts (Interest) Act 1998 may still apply once the sum is due and unpaid. Those rights do not create a personal guarantee where none exists.
Should you instruct on the company debt or a guarantee claim?
Debt Collection UK introduces B2B commercial claims — typically clear unpaid invoices owed by a business. Partners collect under their terms. We are not solicitors and we do not litigate personal guarantee claims as a law firm.
In practice:
- Clear company debt: Upload the invoice, contract or PO, and chase history when the balance is documented and undisputed enough to instruct. Marketing fee: 15% only when the client is paid; often no-collection, no-fee. Recovery is not guaranteed. Overview: business debt collection.
- Personal guarantee angle: Keep the signed PG with your pack and tell us it exists. Partners may still focus first on the company debt. Enforcing a guarantee against an individual can need separate solicitor advice, different pre-action steps (especially if the debtor is an individual under the Debt PAP), and is outside any pretence that we are your litigators.
Do not upload expecting us to “pierce the corporate veil” without documents. Separate legal personality is the starting point; a signed guarantee is the usual exception for trade suppliers.
Frequently asked questions
Are directors personally liable for unpaid company invoices? Not solely because they are directors. The company’s debts are normally the company’s. Personal liability usually needs a signed personal guarantee, another personal contract, or a specific legal route (for example certain insolvency or wrongful-act claims) — get solicitor advice on those; we do not provide it.
What is a personal guarantee on a B2B invoice? A contractual promise by an individual to pay if the company does not, usually in a signed deed or credit form. Being named as a director at Companies House is not itself a personal guarantee.
How do I check if I have a personal guarantee? Review the credit application, signed terms, any guarantee deed, and emails accepting a personal undertaking. Confirm who signed and in what capacity. Companies House will not list an ordinary trade PG.
Should I chase the director personally if the Ltd company ignores me? Only if you have a clear personal undertaking or solicitor advice that a personal claim is available. Otherwise chase the company properly — reminders, Practice Direction letter before action, then partner instruction or court. See limited company ignores final demand.
Will Debt Collection UK enforce a personal guarantee for me? We introduce B2B commercial claims to partners. Partners typically recover clear company invoice balances. Guarantee enforcement against an individual may need separate legal advice. We are not solicitors. Fee on partner recovery: 15% only when the client is paid. Recovery is not guaranteed.
Does recovery cost nothing if I mention a director’s guarantee? No. This guide has no fee. Partner recovery is a fixed percentage of what is recovered (15% only when the client is paid; often no-collection, no-fee). Recovery is not guaranteed.
If a limited company owes you a clear B2B invoice, confirm the entity, assemble proof, and follow a calm Practice Direction path — do not invent personal liability without a signed guarantee. The fee is 15% of what is recovered, payable only when you have been paid. Recovery is not guaranteed. Upload the invoice, contract, and any signed personal guarantee when you are ready to instruct on a clear commercial balance.