Debt Relief Order (DRO): what it is and how to apply

What a DRO is

A DRO is one of several formal debt solutions available in England and Wales, alongside options such as bankruptcy, an Individual Voluntary Arrangement, or Breathing Space. It is aimed at people who have a relatively low level of debt, few or no valuable assets, and no realistic prospect of paying creditors anything meaningful.

Who can apply

A debt adviser will check whether you meet a set of fixed limits on how much you owe, what you own, and what your vehicle is worth. These limits are set nationally and do not vary by council or adviser.

Alongside those limits, you must not have enough spare money at the end of the month to make meaningful debt repayments, and you must have lived or worked in England or Wales in the last three years. You must not already be bankrupt, subject to an interim order or an Individual Voluntary Arrangement, and you must not have had a DRO in the previous six years.

How to apply

1. Contact a free debt-advice organisation, such as National Debtline, Citizens Advice or another approved adviser listed on MoneyHelper.
2. The adviser will go through your income, debts and belongings with you, free of charge, and work out whether a DRO is the right fit for your situation.
3. Do not worry if you are not sure exactly what you owe — the adviser will help you work it out from your paperwork.
4. If you are eligible and a DRO is suitable, the adviser completes an application and submits it to the Insolvency Service on your behalf. You do not go to court.
5. If a DRO is not suitable, the same adviser will talk through what else is available.

What happens during and after a DRO

Most everyday debts can be included in a DRO, including credit cards, overdrafts, loans, rent arrears, unpaid utility bills, council tax arrears and benefit overpayments. Council tax arrears are a priority debt with serious enforcement powers behind them, so including them in a DRO can matter — but whether that is the right route for your circumstances is exactly the kind of question a debt adviser, not this page, should answer.

Some debts cannot be included, such as student loans, child maintenance, court-ordered damages, and Social Fund budgeting or crisis loans. You still have to keep paying these, along with any ongoing commitments like current rent, during the DRO period.

While your DRO is in place, creditors listed in it cannot ask you for payment or add interest and charges. There are also restrictions on your own conduct — for example telling a lender about your DRO before borrowing above a set threshold, and not acting as a company director without a court’s permission. A debt adviser will explain what applies to you.

A DRO shows on your credit reference file, usually for six years from when it was approved, which is the same length of time as other debt relief options. Once the DRO period ends, you stop owing the debts that were included in it.

If your circumstances change

A DRO is based on your circumstances at the time you apply. If your income increases, or you receive money or valuable possessions during the DRO period, you have to tell the Insolvency Service, and it can reassess how that affects you. If you are not sure whether a change affects your DRO, speak to your debt adviser.

Related guides

• Breathing Space: temporary protection from your creditors
• Debt Arrangement Scheme (DAS): Scotland’s statutory debt solution
• Budgeting Loan: the interest-free loan for people on legacy benefits
• Budgeting Advance: the Universal Credit loan you pay back
• Council Tax Reduction: how much you could get off your bill