Debt Relief Order (DRO): Limits, Rules and How to Apply

A debt relief order (DRO) freezes most of your debts for 12 months and then writes them off, and in England and Wales it is open to people who owe no more than £50,000, have no more than £75 a month spare income and own assets worth no more than £2,000. There has been no application fee since 6 April 2024, and you apply through an approved debt adviser rather than a court. Northern Ireland has its own DRO with matching limits; Scotland has no DRO.

What a DRO is

A DRO is a formal insolvency solution for people with relatively low debts and little income or property to pay them. It is set out in Part 7A of the Insolvency Act 1986. The official receiver, part of the Insolvency Service, makes the order.

Once it is made, the creditors named in it cannot take action to recover those debts for a year. At the end of that year you are freed from them, including interest and charges (section 251I), provided the order has not been revoked.

A DRO is not the right fit for everyone. Free debt advisers can compare it with bankruptcy, an IVA and informal options, and a breathing space can pause creditor action while you decide. Our comparison of UK debt solutions sets them out side by side.

Who can get a DRO in England and Wales

The conditions are in Schedule 4ZA to the Insolvency Act 1986, with the money limits set by separate orders.

The new debt and vehicle limits apply to applications made on or after 28 June 2024. The £75 and £2,000 limits did not change in 2024, despite claims you may see elsewhere.

Spare income means what is left of your monthly income after the reasonable domestic needs of you and your family. Your adviser works this out with you using a standard budget. If you have a vehicle adapted for a disability, tell your adviser, because the Insolvency Service's guidance treats it differently from the £4,000 limit.

You must also meet these conditions under Schedule 4ZA:

• you are domiciled in England or Wales, or have lived or carried on business there at some point in the last 3 years
• you are not an undischarged bankrupt, not in an IVA or subject to an interim order, and not subject to a bankruptcy or debt relief restrictions order
• you have not had a DRO in the last 6 years
• you do not have a bankruptcy application in progress, and no creditor's bankruptcy petition is pending against you unless that creditor consents to the DRO application
• you have not, in the last 2 years, given away property or sold it for less than it was worth, or paid one creditor in preference to others

gov.uk describes the same tests in plain terms and says the adviser will look at payments to creditors and any gifts or sales over the past 2 years.

Is there a fee?

No. gov.uk says you do not need to pay for a DRO and there is no application fee. The Insolvency Service announced that the £90 fee would be removed from 6 April 2024, making DROs a free service.

An Insolvency Service review published in July 2026 found that the 2024 changes had widened access, with removing the fee driving a large rise in applications.

Because the approved advisers who submit DROs do so free of charge, you should not pay anyone to arrange one.

How to apply

You cannot apply yourself. Under section 251B, the application goes to the official receiver through an approved intermediary: a debt adviser authorised to make DRO applications. You do not go to court.

gov.uk names National Debtline, Citizens Advice, AdviceUK, Payplan and Christians Against Poverty among the organisations whose advisers can help. The adviser:

1. checks whether you meet the conditions, free of charge
2. goes through your income, spending, property and debts with you
3. looks at payments to creditors and gifts or sales in the last 2 years
4. completes the online application to the Insolvency Service with you

You must give complete and accurate information. A DRO made on wrong or incomplete information can be revoked.

Which debts are included

gov.uk says a DRO can include:

• credit cards, overdrafts and loans, including buy now pay later
• rent arrears and utility bills
• council tax and income tax
• benefit overpayments
• money owed to friends and family

These debts are not included, and you will still have to pay them:

• child maintenance and other family court liabilities
• student loans
• Social Fund budgeting and crisis loans
• secured debts, such as a mortgage
• damages for personal injury or death
• unpaid TV licence fees
• court fines and confiscation orders (Insolvency Rules 2016, rule 9.2)

Debts arising from fraud are not written off at the end of the order (section 251I). A DRO also does not release anyone who guaranteed the debt or owes it jointly with you, so they can still be asked to pay. If you have council tax arrears, see our guide to council tax liability.

What happens during the 12 months

The order starts a moratorium. Under section 251G, a creditor named in the order has no remedy for that debt and cannot start a bankruptcy petition or other court action over it without the court's permission. A secured creditor keeps its security.

The moratorium lasts one year (section 251H). The official receiver can extend it in limited cases, such as to finish an investigation (which needs the court's permission), but not by more than 3 months beyond that year. The court can also extend it.

gov.uk says no further debts can be added once the order is approved. Your bank may stop letting you use your current account, and some creditors may keep sending balance statements for 12 to 18 months.

Your duties

You must tell the official receiver if your income goes up, you acquire property, or you find an error in your application (section 251J). Creditors can object during the moratorium, and the official receiver can investigate even after the order.

Under section 251L, the official receiver can revoke the DRO if the information you gave was incomplete or misleading, you break your duties, or you no longer meet the conditions, including the income and property limits. If the order is revoked, the debts become payable again. gov.uk's guide for people who already have a DRO warns that you would then owe the debts plus interest built up in the meantime, and creditors can add penalties.

Restrictions

gov.uk says that while you have a DRO you cannot:

• borrow more than £500 without telling the lender about the DRO
• write cheques when you do not have enough money to cover them
• act as a company director, or create, manage or promote a company, without the court's permission
• run a business under a different name from the one in your DRO without telling those you deal with

You may be prosecuted if you break these rules.

Debt relief restrictions orders

If the official receiver believes you acted dishonestly or irresponsibly, the restrictions can be extended. The court can make a debt relief restrictions order (DRRO) on the application of the Secretary of State or the official receiver acting on the Secretary of State's direction (Schedule 4ZB).

The conduct considered mirrors the bankruptcy rules: failing to keep records, giving away assets or favouring some creditors, gambling or unreasonable extravagance, fraud, and failing to cooperate with the official receiver. A DRRO lasts at least 2 years and no more than 15. You may be offered a debt relief restrictions undertaking (DRRU) instead, which has the same effect without a court hearing.

After the DRO

These points come from gov.uk's guides on getting a DRO and life with a DRO. Our guide to CCJ removal explains how credit file entries are handled.

Debt relief orders in Northern Ireland

Northern Ireland has its own DRO, run with the Insolvency Service through approved intermediaries. The Department for the Economy says a DRO lasts 12 months and sets out these conditions:

• you must not owe more than £50,000
• you can own a car worth up to £4,000, and your other assets must not exceed £2,000 in total
• your disposable income must be no more than £75 a month
• you must be domiciled in Northern Ireland, or have lived or carried on business there in the last 3 years
• you must not have had a DRO in the last 6 years

The debt, income and asset limits rose on 8 July 2024 under the Insolvency (Monetary Limits) (Amendment) Order (Northern Ireland) 2024. The car limit followed later: it rose from £2,000 to £4,000 only for applications made on or after 10 January 2025, under SR 2024/224.

The Department's guide says the £90 charge was abolished and there has been no charge since 17 June 2024. The Department also says that because of the limit on assets, the scheme is not suitable for homeowners.

Some older Northern Ireland pages still show the previous £20,000 debt limit. Rely on the Department for the Economy's topic page and your adviser. The application is completed online with an approved intermediary, then printed, signed and posted to the DRO Unit of the Insolvency Service in Belfast.

Scotland: no DRO

Scotland does not have debt relief orders. The nearest equivalent is the Minimal Asset Process (MAP), a form of bankruptcy for people with debts of up to £25,000 and very few assets, which has no application fee. Our bankruptcy guide explains MAP and how to apply through an approved money adviser, and mygov.scot lists free debt advice in Scotland.

Frequently Asked Questions

What are the DRO limits in 2026?

In England and Wales you must owe no more than £50,000, have no more than £75 a month spare income and own property worth no more than £2,000, with one vehicle worth up to £4,000 not counted. Northern Ireland uses the same figures, with its £4,000 car limit applying to applications from 10 January 2025.

How much does a debt relief order cost?

Nothing. There has been no application fee in England and Wales since 6 April 2024 and none in Northern Ireland since 17 June 2024. Approved debt advisers check eligibility and submit the application free, so you should not pay anyone to arrange a DRO.

Can I apply for a DRO myself?

No. The application must go through an approved intermediary, a debt adviser authorised to make DRO applications. gov.uk names organisations including National Debtline, Citizens Advice and Christians Against Poverty. You do not need to go to court.

What debts can a DRO not include?

Child maintenance and family court liabilities, student loans, Social Fund budgeting and crisis loans, secured debts such as a mortgage, damages for personal injury or death, unpaid TV licence fees, and court fines and confiscation orders. Debts from fraud are not written off.

Can I have a DRO if I own a home?

It is unlikely to fit. All your property counts towards the £2,000 asset limit, apart from one vehicle worth up to £4,000, and the Northern Ireland Department for the Economy says the scheme is not suitable for homeowners. A free debt adviser can explain the other options.

What happens if my income goes up during a DRO?

You must tell the official receiver. If your spare income rises above the limit, or you acquire property that takes you over it, the DRO can be revoked and the debts become payable again, possibly with interest added.

How long does a DRO stay on my credit file?

gov.uk says 6 years from the date it was approved, and the debts in it will not show as paid or settled. Your entry on the Individual Insolvency Register is removed 3 months after the DRO ends.

Is there a debt relief order in Scotland?

No. Scotland has the Minimal Asset Process instead, a form of bankruptcy for people with debts of up to £25,000 and few assets, applied for through an approved money adviser with no application fee.