What Is a Debt Relief Order?

A Debt Relief Order, usually shortened to DRO, offers a formal insolvency solution for people in England, Wales, and Northern Ireland who cannot realistically pay their debts. It suits people with relatively low debts, little spare income, and few valuable assets. Once granted, a DRO freezes most debt repayments and creditor action for 12 months. If your circumstances have not improved by the end of that period, it writes off most of the debts it includes.

People often describe a DRO as a simpler, cheaper alternative to bankruptcy, and it does not require a court hearing.

Who Is Eligible for a DRO

You will usually need to meet all of the following conditions:

  • You owe less than a set threshold in qualifying debts. This threshold can change, so check the current limit before applying.
  • You have little or no spare income once you cover your essential living costs.
  • You do not own valuable assets, or your assets fall within a set limit.
  • You have not had a DRO in the last six years, and you are not currently subject to another formal insolvency process.
  • You live in England, Wales, or Northern Ireland, or you have lived there within the last three years.

The authorities review these thresholds periodically, so always confirm the current figures through an approved debt adviser rather than relying on older guidance you may have seen elsewhere.

How to Apply for a DRO

You cannot apply for a DRO directly yourself. You need to go through an approved intermediary, a trained debt adviser authorised to submit DRO applications to the Insolvency Service. Many debt advice charities offer this service free of charge.

The general process

  • You speak to an approved intermediary about your debts, income, and assets.
  • They assess whether you meet the eligibility criteria.
  • If you qualify, they submit your application to the Insolvency Service on your behalf.
  • The official receiver, not a court, decides whether to grant the order.

England and Wales no longer charge an application fee for a DRO, so applying is now free.

What Happens During a DRO

Once you receive your DRO, most of your listed creditors cannot take further action to recover the included debts for the 12 month period. You will have certain duties during this time, such as informing your intermediary if your financial situation changes significantly, for example if you receive a large sum of money or your income increases.

At the end of the 12 months, assuming your circumstances have not improved enough to repay your debts, the order writes off most of the debts it includes.

How a DRO Affects You

A DRO counts as a serious legal step, even though it is simpler than bankruptcy. It stays on your credit file for six years from the date you receive it, and it will affect your ability to get credit during that time. Credit reference agencies record it as a formal insolvency marker, similar in effect to bankruptcy or an IVA on your file, even though the DRO process itself works differently.

Some jobs and professional memberships carry rules about insolvency that could affect you if you get a DRO, so check any relevant professional or employment rules that apply to you.

DRO vs Bankruptcy vs IVA

A DRO generally suits you only if you have low debts, little spare income, and few assets. If you have higher debts, more income, or assets you want to protect, bankruptcy or an IVA may suit you better instead. Our comparison of IVA and bankruptcy in the UK explains how those two options differ, and our bankruptcy guide covers the wider insolvency process in more detail.

An approved intermediary or debt adviser can help you work out which option, if any, fits your situation, since eligibility and outcomes depend heavily on your specific finances.

Frequently Asked Questions

Is a DRO the same as bankruptcy?

No. A DRO offers a simpler, cheaper process without a court hearing, aimed at people with low debts and few assets. Bankruptcy is a more far reaching process that can affect higher value assets and carries different eligibility rules.

Can I apply for a DRO myself?

No. You must apply through an approved intermediary, a trained debt adviser authorised to submit DRO applications on your behalf.

How long does a DRO stay on my credit file?

Six years from the date you receive it, regardless of how long the DRO process itself lasts.

What happens if my situation improves during the 12 months?

You must tell your intermediary. Depending on the change, the Insolvency Service could revoke your DRO, and you may need to consider a different debt solution such as an IVA.

Getting Help With Debt

If you are struggling with debt, speak to a free, approved debt adviser before deciding on any formal solution. They can assess your eligibility for a DRO and explain how it compares with other options such as an IVA or bankruptcy. See our guide to getting legal advice for how to find the right kind of support.

This article gives general information only. It does not constitute legal or financial advice. Eligibility thresholds and fees are estimated and subject to change. Always confirm current figures with an approved debt adviser or the Insolvency Service before making decisions about your debts.