How income, debts and belongings are assessed for a debt relief order

Summary

Your DRO adviser will work out how much spare available income you've got, looking at all the money you've got coming into your household. This could include: * welfare benefits, such as Universal Credit or Jobseeker's Allowance * any contributions other people, such as family members, make to your household expenses If you get a disability benefit like Personal Independence Payment, they're income, but can automatically be counted as normal household spending. This also applies to Disability Living Allowance, Attendance Allowance and disability premiums. It’s worth discussing how you use your disability benefits with your DRO adviser. You will be able to deduct a reasonable amount for your household expenses. If the figure left over each month is £75 or less, you will be able to apply for a DRO, if you meet the other conditions. Your DRO adviser will work with you to put together a list of all your debts, including: * amounts owed on credit agreements such as credit cards or loans * council tax, income tax and utilities arrears If the total of all these debts comes to £50,000 or less you'll be able to apply for a DRO if you meet the other conditions. The full amount of any debts.

Key information

• welfare benefits, such as Universal Credit or Jobseeker's Allowance
• any income you get from a pension
• any contributions other people, such as family members, make to your household expenses
• amounts owed on credit agreements such as credit cards or loans
• council tax, income tax and utilities arrears
• arrears of hire purchase payments.
• jewellery, not including wedding rings
• other items of value you own, including mobile phones
• household equipment such as bedding, clothing and furniture
• tools, books and other items of equipment you use in your job or business
• most kinds of pension funds, unless you can access the money now - check with your DRO adviser whether your pension funds are counted as assets or not
• What happens when a DRO is made

Practical guidance

• Source: How income, debts and belongings are assessed for a debt relief order

Related topics

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• Check if a financial service has followed the rules
• Check if you have to pay a debt
• Check the rules after you go bankrupt
• Check what an IVA is
• Cold called by a debt management plan provider