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i This solution is only available in England, Wales and Northern Ireland.

Debt Relief order (DRO)

A DRO can help you to write off debt that you’re unable to repay in a reasonable amount of time.

A debt relief order (DRO) is only available in England, Wales and Northern Ireland. If you live in Scotland you might be able to apply for a MAP bankruptcy, which is a similar solution, but it's important to note that it has different benefits, risks and fees associated with it.

To apply for a DRO you need to meet the following criteria:

  • Owe less than £15,000 in unsecured debts
  • You can’t be a homeowner
  • Have no more than £300 in assets
  • Have less than £50 a month left over after you’ve paid all of your living costs

UPDATE: On 1 October, DRO eligibility is changing in England and Wales. From this date the maximum amount of debt that can be included in a DRO application increases from £15,000 to £20,000, and the amount of assets you can own and still be able to apply for a DRO increases from £300 to £1,000. You’ll still be able to own one motor vehicle worth £1,000 on top of this. There will be no other changes.

As of June 2015, in Northern Ireland the current eligibility criteria of £15,000 debts and £300 assets and £1,000 car value are NOT scheduled to change in October.

DRO eligibility is changing on 1 October 2015

On 1 October, DRO eligibility is changing in England and Wales. From this date the maximum amount of debt that can be included in a DRO application increases from £15,000 to £20,000, and the amount of assets you can own and still be able to apply for a DRO increases from £300 to £1,000. You’ll still be able to own one motor vehicle worth £1,000 on top of this.

There will be no other changes. As of June 2015, in Northern Ireland the current eligibility criteria of £15,000 debts and £300 assets and £1,000 car value are NOT scheduled to change in October.

Is a DRO right for me?

DROs are only available in England, Wales and Northern Ireland. If you live in Scotland you may be able to apply for a MAP (minimal assets process) bankruptcy. To see if a MAP bankruptcy is the best solution for you, use our online Debt Remedy tool or call our free Helpline.

What does a DRO cost?

A DRO costs £90. You pay the fee directly to The Insolvency Service. This can be paid in full or in instalments, but you can’t submit your application until the fee is completely paid.

How a DRO works

If your DRO is approved your debts are put on hold for 12 months. During this time your creditors cannot pursue you for the outstanding debt, although interest and charges can still be added. If after the 12 months your circumstances haven't changed, then all of your debts are written off.

If during the 12 month period your DRO is cancelled (revoked), your creditors will then be in a position to pursue the debt with interest and charges added. You would then need to consider what other repayment options are available to you. Should this happen, we can help you look into what you can do next.

DRO FAQs

Do I need to go to court to apply for a DRO?

No. A DRO involves no court hearing and the order is not made by a judge.

Will I have to make any further payments into the DRO once I’ve paid the £90 fee?

No. The £90 fee is used to process the DRO and is all you have to pay.

I don’t have the £90 to pay for a DRO. Are there any funding options available to me?

In some cases, you can apply to have the fee paid by a charity or trust fund, but it’s not guaranteed that you’ll qualify. Should you be recommended a DRO, we can talk you through the process of applying for help with your DRO fee.

Are any debts excluded from a DRO?

Yes. The following debts are not included in a DRO;

• Student Loans

• Magistrates’ court fines

• Maintenance, Child Support Agency (CSA) and Child Maintenance Service (CMS) payments and arrears

• Social Fund Loans (Crisis loans)

• Debts incurred under the Proceeds of Crime Act

• Debts resulting from certain personal injury claims made against you

How will a DRO affect my credit rating?

A DRO will be registered on your credit file for six years, which will affect your credit rating. During this time you’ll find it harder to take out any further credit.

What assets are taken into consideration in a DRO application?

Assets which are taken into account for a DRO include:

• Savings, shares or investments

• Property or land you own

• High value household items such as electrical goods or jewellery

• Money other people owe to you

If you own assets like these totalling more than £300 value, your DRO won’t be approved.

Some assets aren’t taken into account. If you own any of these, you won’t be ruled out of a DRO as long as the value of the items is not excessive:

• One motor vehicle worth no more than £1,000

• Tools and other items needed for your job

• Ordinary household furnishings, appliances, clothes and bedding

• A tenancy deposit held by your landlord

Money you have saved in a pension fund doesn’t count towards the asset limit. But if you’re over 55 and you could draw down enough money from your pension fund to pay off all your debts, you won’t qualify for a DRO.

Where will my DRO be listed?

Your DRO and details such as your name and address will be listed in the Individual Insolvency Register (IIR). Your details will be listed for the duration of the DRO (12 months) and usually removed within three months of the case ending.

An application can be made to keep your address details off the Individual Insolvency Register. This is only granted in exceptional circumstances however, such as where there’s a risk of domestic violence or other personal harm.

Can a DRO affect my job?

DROs may affect some jobs if the employment contract specifies that the client can't be insolvent. This is most likely to be an issue in the finance and legal sectors, but other jobs may also be affected.

I have power of attorney for a vulnerable person and I believe a DRO would be suitable for them. How would I look into this?

When an authorised third party contacts us on behalf of a person for who they have power of attorney, we would look at the person’s budget and explore all possible debt solutions, as well as a DRO. However, we can only do this once power of attorney has been proven by means of a letter of authority.

Please contact us for more information on how to seek debt advice via power of attorney.

More of our DRO advice and help

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Foundation for Credit Counselling (trading as StepChange Debt Charity) is a company limited by guarantee registered in England and Wales (Company No: 2757055 ) and a charity registered in England and Wales (Registered Charity No: 1016630). Registered office: Wade House, Merrion Centre, Leeds, LS2 8NG. Consumer Credit Counselling Service (Scotland) trading as StepChange Debt Charity Scotland is a company limited by guarantee registered in Scotland (Company No: SC162719) and a charity registered in Scotland (Registered Charity No:SC024413). Registered office: 33 Bothwell Street, Glasgow G2 6NL. Authorised and regulated by the Financial Conduct Authority.

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