Key points
- Debts of £50,000 or less
- £75 or less spare income a month
- Assets of £2,000 or less, plus a vehicle worth up to £4,000
- No application fee
- Lasts 12 months, then qualifying debts are written off
What is a Debt Relief Order?
A Debt Relief Order (DRO) is a formal insolvency solution for people in England and Wales who can't afford to repay their debts and have little or no spare income or assets. It lasts 12 months. During that time your creditors can't chase you for the debts included, and at the end most of those debts are written off.
Who can get a DRO?
To qualify, you will usually need to meet all of these conditions:
- Your total qualifying debts are £50,000 or less.
- You have £75 or less a month left over after paying essential living costs.
- Your assets are worth £2,000 or less, not counting a vehicle worth up to £4,000.
- You've lived, owned property or worked in England or Wales in the last three years.
- You haven't had a DRO in the last six years.
The debt limit rose from £30,000 to £50,000 in June 2024, and the £90 application fee was removed in April 2024, so far more people now qualify than a few years ago.
Which debts are covered?
Most unsecured debts can be included, such as credit cards, overdrafts, personal loans, payday loans, catalogue debts, utility arrears, council tax arrears and benefit overpayments. Some debts can't be included, including student loans, court fines, child maintenance and most debts caused by fraud.
How to apply
You can't apply yourself. You apply online through an approved intermediary, who is usually a trained adviser at a free debt advice organisation. They check you qualify, help you complete the application and send it to the Insolvency Service.
What are the downsides?
- The DRO is recorded on your credit file for six years and on the public Individual Insolvency Register.
- You can't borrow more than £500 without telling the lender about your DRO.
- If your circumstances improve during the 12 months, for example you get a pay rise or inheritance, the DRO may be cancelled.
- Some jobs and roles may be affected, so check with your employer or professional body.
Frequently asked questions
Is there a fee for a Debt Relief Order?
No. The application fee was removed in April 2024, so a DRO is free to apply for.
What is the debt limit for a DRO?
Your total qualifying debts must be £50,000 or less.
Can I keep my car with a DRO?
Usually yes, if it is worth £4,000 or less. A vehicle adapted for a disability may be allowed even if it is worth more.
Free debt advice is available
You can get free, impartial debt advice from not-for-profit organisations through MoneyHelper's debt advice locator.
Sources and further reading
This guide is general information, not advice, and was correct when last updated. Rules and limits can change. Speak to a regulated adviser about your own situation.