Last reviewed: May 2026
Key facts:- A Debt Relief Order is a formal insolvency procedure for people with low income, very few assets and debts under 50,000 pounds.
- The DRO fee was abolished in 2024, making applications free to people who qualify.
- Most debts in a DRO are written off after a 12-month moratorium period, provided the debtor circumstances do not significantly improve during that year.
UK Debt Help Hub › What Is A Debt Relief Order Uk
A Debt Relief Order is a formal insolvency option for people who cannot pay their debts but who do not qualify for or want to use bankruptcy or an IVA. Eligibility was widened significantly in 2024, with the debt threshold raised to 50,000 pounds and the fee abolished. This upgraded guide covers the current eligibility tests, the application process through an authorised intermediary, what happens during the 12-month moratorium, and how debts are written off at the end.
Eligibility Tests
The current eligibility tests for a DRO require the applicant to have total qualifying debts of 50,000 pounds or less (raised from 30,000 pounds in 2024), assets of 2,000 pounds or less (excluding a single motor vehicle worth up to 4,000 pounds), and surplus monthly income after essential expenses of 75 pounds or less.
The applicant must also have lived or worked in England, Wales or Northern Ireland in the previous three years. Scotland has its own equivalent procedures under the Bankruptcy and Diligence etc. (Scotland) Act 2007.
Some debts are excluded from a DRO. These include student loans, certain court fines, child maintenance arrears (in some cases), and secured debts. Excluded debts continue to be enforceable during and after the DRO.
Applying Through an Authorised Intermediary
DRO applications cannot be made directly by the debtor. The application must be made through an Authorised Intermediary, typically a debt adviser at Citizens Advice, StepChange, Christians Against Poverty, or another approved organisation.
The intermediary reviews the debtor circumstances, confirms eligibility, gathers the supporting evidence, and submits the application electronically to the Insolvency Service. The intermediary does not charge the debtor for this service.
The Insolvency Service reviews the application and, if satisfied that the eligibility tests are met, makes the DRO. The order takes effect from the date it is made. The debtor is notified, and creditors are notified separately.
The Fee Abolition in 2024
Until April 2024, the DRO fee was 90 pounds, payable to the Insolvency Service before the application could proceed. The fee was widely seen as a barrier for the very people the DRO scheme was designed to help.
The fee was abolished from April 2024. DRO applications are now free at the point of use. Funding comes from the wider Insolvency Service budget rather than from applicant fees.
The fee abolition coincided with the increase in the debt threshold from 30,000 pounds to 50,000 pounds and the increase in the maximum vehicle value disregard from 2,000 pounds to 4,000 pounds. Together these reforms widened access to the DRO scheme significantly.
The 12-Month Moratorium
Once the DRO is made, the debtor enters a 12-month moratorium period. During the moratorium, creditors cannot enforce the qualifying debts. They cannot send demands, take court action, or instruct bailiffs.
The debtor has duties during the moratorium. They must inform the Official Receiver of any change in circumstances, including a windfall, inheritance, lottery win, or significant increase in income. They must not take on new credit of 500 pounds or more without disclosing the DRO.
If the debtor circumstances improve significantly during the moratorium - for example, getting a well-paid job or receiving an inheritance - the Official Receiver may revoke the DRO. The debts then become enforceable again. The bankruptcy option may be considered if circumstances change substantially.
Discharge and Effect on Credit
At the end of the 12-month moratorium, the qualifying debts are discharged - that is, written off. The debtor is no longer liable to pay them. The creditors cannot pursue payment.
The DRO stays on the public Individual Insolvency Register until 15 months after the DRO date (the 12-month moratorium plus three months). After that the register entry is removed. The DRO stays on the debtor credit file for six years from the date of the order, regardless of when discharge happens.
After discharge, the debtor has a clean slate for the qualifying debts. They can start to rebuild credit, although mainstream lenders typically take several years to extend credit again. Some specific roles in financial services and law have restrictions that may continue beyond the six-year credit file window.
Common Issues That Arise During a DRO
Receiving a windfall. A significant change in circumstances - inheritance, lottery win, redundancy payment - must be reported to the Official Receiver immediately. The Official Receiver may revoke the DRO if circumstances change materially. The threshold for material change is judgement-based.
Starting work or getting a pay rise. Regular employment or a significant pay rise during the DRO can also trigger Official Receiver review. The 75 pounds monthly surplus income limit is at the date of application; significant changes after that point can affect the DRO.
New debts. The DRO discharges the qualifying debts at the end of the moratorium. New debts incurred during the moratorium are not discharged and remain payable. New credit of 500 pounds or more must be disclosed to the lender.
Disposing of assets. Selling assets above the disregard limits during the moratorium can affect the DRO. The Official Receiver may revoke if assets are disposed of without disclosure. Honest reporting of all asset changes is required.
Where to Get Free Independent Help
StepChange is the UK leading debt charity, providing free debt advice on debt relief order dro uk and other debt issues. StepChange offers Debt Management Plans, Debt Relief Order applications, IVA referrals and budgeting help. Contact is through stepchange.org or by phone.
National Debtline is operated by the Money Advice Trust and provides free, independent debt advice. The service is by phone, webchat and online self-help. National Debtline produces detailed guides on debt remedies including bankruptcy, IVAs, DROs and Debt Management Plans.
Citizens Advice provides free debt advice through local offices and online. Citizens Advice has good integration with other services (benefits, housing, employment) that often interact with debt problems. The Citizens Advice debt service is widely accessible across the UK.
The Insolvency Service is the government agency that administers personal insolvency. It runs the Individual Insolvency Register and the Debt Relief Order scheme. The Official Receiver is the part of the Insolvency Service that supervises bankruptcies and DROs.
PayPlan and Christians Against Poverty (CAP) provide free debt advice through their own channels. Both offer Debt Management Plans and casework support. Eligibility for some services depends on the household financial situation.
For mortgage and rent arrears specifically, Shelter and the Money and Pensions Service provide targeted housing debt help. The Mortgage Adviser network (FCA-regulated) gives free initial mortgage advice that can sometimes restructure arrears more affordably than the lender direct.
Putting It All Together
The rules above set out the legal framework, the practical steps and the support routes available. Where the situation is straightforward, the gov.uk pages and the official tools should be enough to act on. Where the situation is more complex, the free advice services listed in the previous section can usually clarify the position and identify the right next step. Many issues that look intractable at first turn out to be resolvable once the right service is engaged.
Keeping written records of communications and decisions throughout is good practice. Where a decision needs to be challenged later - through an internal complaint, an ombudsman, a tribunal or a court - the quality of the contemporaneous record often decides the outcome. Dates, names, reference numbers and copies of correspondence are the building blocks of any later dispute. The gov.uk advice pages and the relevant ombudsman or tribunal websites all set out the evidence they consider when reviewing decisions, and gathering that evidence from the start is one of the most effective protections available.
Frequently Asked Questions
Do I have to pay for a DRO?
No. The 90 pound fee was abolished in April 2024. DRO applications are now free for applicants who qualify.
Can I get a DRO with 40,000 pounds of debt?
Yes. The debt threshold was raised to 50,000 pounds in April 2024. Applicants with debts of 50,000 pounds or less can apply, provided the income and asset tests are also met.
Can I apply directly to the Insolvency Service?
No. DRO applications must be made through an Authorised Intermediary at a debt advice organisation. This rule ensures applicants receive proper advice before formal insolvency.
What debts are not included?
Student loans, certain court fines, secured debts (such as mortgages), child maintenance arrears in some cases, and debts incurred by fraud. These continue to be enforceable during and after the DRO.
How long does a DRO stay on my credit file?
Six years from the date the DRO is made. The public Individual Insolvency Register entry comes off after 15 months, but the credit file entry stays for the full six years.
Can I get credit during a DRO?
Limited credit is allowed, but new credit of 500 pounds or more must be disclosed to the lender. Most lenders refuse credit applications from anyone currently in a DRO.
Can a DRO be reversed?
Yes. The Official Receiver can revoke the DRO if the debtor circumstances change materially during the moratorium. The qualifying debts become enforceable again. Bankruptcy may be the alternative.
Do my debts come back if my DRO is revoked?
Yes. Revocation restores the qualifying debts. Creditors can resume enforcement. The debtor returns to the pre-DRO position with the addition of any interest or charges accrued during the moratorium where the debt terms allow.
Can I have more than one DRO in my lifetime?
There is no statutory limit but in practice each DRO requires an authorised intermediary to assess the situation. Multiple DROs would only be possible if the eligibility criteria are met each time and the debt advisor believes a fresh DRO is the right route.
Will a DRO show on my credit file?
Yes. The DRO appears on the credit file from the date the order is made and stays for six years from that date, regardless of when the moratorium ends.
How We Verified This
Information is taken from Part 7A of the Insolvency Act 1986 on legislation.gov.uk, the Insolvency Rules 2016 on Debt Relief Orders, the Debt Relief Orders (Designation of Competent Authorities) Regulations 2009, the gov.uk debt relief order pages, and the Insolvency Service guidance on DRO reforms from April 2024.
