Debt Relief Order (DRO)
A Debt Relief Order is a low-cost formal solution for people on low incomes with limited assets. Debts are frozen for 12 months, then usually written off.
Overview
A DRO is designed for people who genuinely can't pay their debts and have very little disposable income or assets. It's applied for through an authorised debt adviser and approved by the Insolvency Service.
During the 12-month moratorium period, most listed debts are frozen. If your situation hasn't improved by the end of that period, the debts are written off entirely.
DROs are much cheaper than bankruptcy — currently £90 in England and Wales — and can be a life-changing option when the alternative is years of unmanageable debt.
Who it's suitable for
- You have under £50,000 of qualifying debts (in England & Wales)
- You have less than £75 per month left after essential costs
- You own assets worth under £2,000 (and no vehicle over the threshold)
- You don't own your home
Advantages
- Debts frozen from day one for 12 months
- Debts written off if circumstances haven't improved
- No monthly payments to make during the DRO
- Low-cost formal solution
- Can be arranged quickly with a competent adviser
Disadvantages
- Recorded on your credit file for six years
- Listed on the public Individual Insolvency Register
- Restrictions on borrowing over £500 without disclosure
- Not everyone will meet the strict eligibility rules
- Some professions have restrictions
Eligibility
General criteria — an adviser will confirm what applies to your circumstances.
- Total qualifying debts under the current cap for your region
- Very limited disposable income after essential outgoings
- Limited assets — savings, valuables and vehicles under the threshold
- You haven't had a DRO in the last six years
Example
Marcus, 29 — Newcastle
Marcus had £11,400 of unsecured debt built up during a period of unemployment. He rents, doesn't own a car, and after essentials had only £30 spare each month.
Illustrative only. Names and figures are examples, not real customers.
How it compares
A quick side-by-side of the main UK debt solutions.
| Solution | Region | Duration | Debt written off? | Credit impact | Type |
|---|---|---|---|---|---|
| Debt Management Plan | UK-wide | Flexible | No | Moderate | Informal |
| IVA | Eng, Wal, NI | 5–6 years | Yes (remainder) | 6 years | Formal |
| Debt Relief Order | Eng, Wal, NI | 12 months | Yes (after 12m) | 6 years | Formal |
| Bankruptcy | UK-wide | ~12 months | Yes | 6 years | Formal |
| Breathing Space | Eng, Wal | 60 days | No | Low | Temporary |
| Token Payments | UK-wide | Short-term | No | Moderate | Informal |
| Full & Final Settlement | UK-wide | One-off | Partial | Moderate–High | Informal |
Frequently asked questions
Not sure where to start? We'll walk you through it.
A quick, confidential chat with a friendly advisor. No pressure, no jargon — just a clear picture of the options that suit your situation.