finance
⏱ 2 min read
📅 Updated Apr 2026
What Is a Debt Relief Order UK? DRO Explained 2026
UK Debt Guide — April 2026 A Debt Relief Order (DRO) is a formal insolvency solution in England Wales and Northern Ireland for people with relatively low debt, low income and few assets. It provides a 12-month moratorium during which creditors cannot act. After 12 months if your circumstances have not improved the debts are written off. DRO Eligibility Criteria 2026| Criteria | Limit |
|---|
| Total qualifying debt | £30,000 maximum (raised from £20,000 in April 2024) | | Disposable income | £75 or less per month after living costs | | Total assets | £2,000 or less — vehicle up to £2,000 allowed | | Residency | England Wales or Northern Ireland | | Previous DRO | Not in last 6 years |
What Debts Are Included?- Credit cards and store cards
- Personal loans and overdrafts
- Council tax arrears
- Utility bill arrears
- Payday loans
- Benefits overpayments in most cases
What Debts Are NOT Included?- Student loans
- Child maintenance arrears
- Court fines
- Fraudulent debts
How the DRO Process Works| Stage | What Happens |
|---|
| Application | Apply through an authorised debt adviser — cannot apply direct to Insolvency Service | | Fee | £90 one-off — can be paid in instalments | | Moratorium | 12 months — creditors cannot chase you or take legal action | | After 12 months | If circumstances unchanged debts written off | | Credit file | Appears for 6 years from approval date |
DRO vs Bankruptcy vs IVA| Solution | Best For | Cost |
|---|
| DRO | Low income low debt few assets under £30,000 | £90 | | Bankruptcy | Higher debts or assets | £680+ | | IVA | Regular income willing to repay over 5 years | Fees from pot | | Debt Management Plan | Can afford some repayment | Free via StepChange |
Bottom line: A DRO can be a lifeline if you have up to £30,000 of debt on a low income with few assets. The £90 fee can be paid in instalments. Contact StepChange Citizens Advice or National Debtline for free advice before making any decision. |
By Chandraketu Tripathi · Updated April 2026 · kaeltripton.com |
Part of our complete guide: UK Inheritance Tax 2026 - Complete Guide → Find a regulated IFA → | Make a will online from £29.99
Editorial Disclaimer
The content on Kaeltripton.com is for informational and educational purposes only and does not constitute financial, investment, tax, legal or regulatory advice. Kaeltripton.com is not authorised or regulated by the Financial Conduct Authority (FCA) and is not a financial adviser, mortgage broker, insurance intermediary or investment firm. Nothing on this site should be construed as a personal recommendation. Rates, figures and product details are indicative only, subject to change without notice, and should always be verified directly with the relevant provider, HMRC, the FCA register, the Bank of England, Ofgem or other appropriate authority before any financial decision is made. Past performance is not a reliable indicator of future results. If you require regulated financial advice, please consult a qualified adviser authorised by the FCA.
CT
Chandraketu Tripathi
Finance Editor · Kaeltripton.com
Chandraketu (CK) Tripathi, founder and lead editor of Kael Tripton. 22 years in finance and marketing across 23 markets. Writes on UK personal finance, tax, mortgages, insurance, energy, and investing. Sources: HMRC, FCA, Ofgem, BoE, ONS.
|
