Debt Relief Order UK: How to Write Off Debt in 12 Months (2026)

Debt Relief Order UK: How to Write Off Debt in 12 Months (2026)

I couldn’t pay my debts. I had no savings. No assets. No way out. I didn’t even know Debt Relief Orders existed.

A DRO is one of the most powerful debt solutions in the UK — and one of the least talked about. If you qualify, your debt is written off after just 12 months. It is completely free to apply.

Here is exactly how it works in 2026.

What Is a Debt Relief Order?

A Debt Relief Order (DRO) is a formal insolvency solution for people in England and Wales who cannot pay their debts and have very few assets or income.

When a DRO is approved:

• All qualifying debts are frozen for 12 months
• You make no payments toward those debts during that time
• Interest and charges stop immediately
• Creditors cannot take enforcement action against you

After 12 months — if your situation has not improved — every qualifying debt is written off completely. Gone. Legal fresh start.

Who Qualifies for a DRO in 2026?

You must meet all of the following:

• Total unsecured debt under £50,000 — this threshold increased from £30,000 in June 2024, opening the door to hundreds of thousands more people
• Assets worth under £2,000 — excluding a single vehicle worth under £4,000
• Disposable income under £75 per month — your income minus essential household expenses
• Not a homeowner — you cannot own property
• Live in England or Wales — or have lived or run a business there in the last 3 years
• Not had a DRO in the last 6 years
• Not currently bankrupt or in an IVA

DROs are not available in Scotland or Northern Ireland. Scotland has its own debt solutions — speak to a free adviser for guidance.

How Much Does a DRO Cost?

Nothing. A DRO is completely free to apply for.

The £90 application fee was abolished in April 2024. You now pay absolutely nothing to apply. This was one of the most significant changes to UK insolvency law in years — the fee was previously stopping the people who needed a DRO most from ever accessing it.

There is no catch. Free means free.

Which Debts Are Included in a DRO?

Most unsecured debts qualify:

• Credit cards and store cards
• Personal loans and overdrafts
• Utility bill arrears
• Council tax arrears
• Benefit overpayments
• Catalogues and buy now pay later

Some debts cannot be included in a DRO:

• Student loans
• Child maintenance arrears
• Court fines
• Debts from fraud
• Social fund loans

These debts survive a DRO — you will still owe them after the 12 months are up. This catches a lot of people out. Make sure you know exactly what is and is not included before you apply.

How to Apply for a DRO

You cannot apply directly. You must go through an approved intermediary — a specialist debt adviser authorised to submit DRO applications to the Insolvency Service.

1. Contact StepChange — stepchange.org or 0800 138 1111
2. Or National Debtline — nationaldebtline.org or 0808 808 4000
3. Or Citizens Advice — citizensadvice.org.uk
4. They assess your situation and confirm eligibility — completely free
5. They submit your application to the Official Receiver
6. If approved — protection starts immediately

The process typically takes a few weeks from first contact to approval. Do not delay. Every week you wait, interest keeps building and your situation can get harder to resolve.

What Happens During the 12 Months?

Once your DRO is approved there are restrictions you must follow:

• You cannot borrow more than £500 without telling the lender you are in a DRO
• You cannot act as a company director
• You must tell your approved intermediary if your financial situation improves significantly
• If your income rises or you receive a windfall the DRO may be revoked

These restrictions are serious. Breaking them is a criminal offence. The 12 months is a fresh start period — not a loophole. Treat it as such.

What Happens After 12 Months?

If your situation has not improved — all qualifying debts are written off completely. You owe nothing on those debts. No further payments. No ongoing obligations. Legal fresh start.

The DRO stays on your credit file for 6 years from the date it was approved. It also appears on the public Insolvency Register during that period. This affects your ability to get credit, but it does not stop you rebuilding. Millions of people have come through this and rebuilt their finances from scratch.

DRO vs Bankruptcy — What Is the Difference?

Not sure which solution fits you? See every UK debt relief option explained in plain English →

Frequently Asked Questions

Can I keep my car with a DRO?

Yes — if it is worth under £4,000. This threshold increased from £2,000 in June 2024. One vehicle under £4,000 is excluded from your asset calculation entirely. If your car is worth more than £4,000 you will not qualify — speak to a debt adviser about your options before assuming you are ineligible.

Does a DRO clear all my debt?

It clears most unsecured debts after 12 months. Student loans, child maintenance, court fines and debts from fraud are not cleared. You will still owe these after the DRO ends. Always get a full list of what is and is not included before you apply.

Will a DRO affect my job?

It depends on your profession. Jobs in finance, law, or roles involving financial responsibility may have restrictions. Some employment contracts have insolvency clauses. Check your contract carefully and speak to a debt adviser before applying if you are unsure.

Can I open a bank account during a DRO?

Yes. Most basic bank accounts remain accessible during a DRO. You may have difficulty with standard current accounts with overdraft facilities. Ask your bank or speak to your debt adviser about suitable accounts before you apply.

What if my situation improves during the 12 months?

You must tell your approved intermediary immediately. If your income rises significantly or you receive a windfall — an inheritance, for example — the DRO may be revoked and you could be required to repay your debts. Honesty is required by law. There is no grey area here.

How long does a DRO stay on my credit file?

Six years from the date it was approved. This is the same as bankruptcy, IVA, and defaults. All negative credit events in the UK have the same 6-year reporting window under the Credit Consumer Act.

Can I apply for a DRO if I live in Scotland?

No. DROs are only available in England and Wales. Scotland has its own equivalent — the Minimal Assets Process (MAP) bankruptcy. Northern Ireland also has separate legislation. Contact a free debt adviser in your country for the right guidance.

What is the Breathing Space scheme and should I use it first?

Breathing Space gives you 60 days of legal protection from creditors while you sort out your options. Interest and charges are frozen. Creditors cannot contact you. It is completely free and does not count as insolvency. If you are considering a DRO, apply for Breathing Space first through StepChange — it buys you time to make the right decision without pressure.

Disclaimer: DebtShift is an educational platform, not a debt advice firm. We are not regulated by the FCA. For free regulated debt advice contact StepChange at stepchange.org or call 0800 138 1111. All information is for general guidance only.