What the Debt Arrangement Scheme Actually Is
If someone in Scotland is struggling to keep up with multiple debts, the Debt Arrangement Scheme (DAS) is one of the formal statutory options available to them. Unlike bankruptcy or a Trust Deed, DAS does not write off any debt — instead, it creates a legally protected repayment plan that lets the individual pay back everything they owe at an affordable rate, over an extended period if necessary.
DAS is administered by the Accountant in Bankruptcy (AiB), the Scottish government agency responsible for personal insolvency and debt management. It is available only in Scotland. Residents of England, Wales, or Northern Ireland cannot access DAS — different formal routes exist in those jurisdictions, including Debt Management Plans and Debt Relief Orders.
The central feature that makes DAS significant is the debt freeze. Once a Debt Payment Programme (DPP) under DAS is approved, interest, fees, penalties, and charges on included debts are frozen for the duration of the programme. This means the total amount owed does not grow, and every payment made goes toward reducing the actual debt balance.
Who Qualifies for DAS in Scotland
DAS is open to individuals living in Scotland who have at least one debt they cannot repay as and when it falls due. There is no upper debt limit — programmes covering six-figure sums have been approved. However, in practice, a minimum total debt of £5,000 is generally expected before a Debt Payment Programme will be approved, as smaller balances may be better suited to informal arrangements.
To access DAS, the applicant must work with a money adviser — either through a free-sector organisation or a fee-charging regulated firm. The money adviser assesses the person's income and expenditure, calculates what they can realistically afford to pay each month, and prepares the formal DPP application. It is not possible to apply directly to the AiB without a money adviser involved.
Conditions That Must Be Met
- The applicant must be resident in Scotland at the time of application.
- There must be a sufficient disposable income to fund a meaningful repayment programme.
- The proposed programme must be realistic — the AiB will not approve a plan that is unaffordable or misleading about the applicant's finances.
- Applicants cannot be subject to an active sequestration (Scottish bankruptcy), Trust Deed, or existing DPP at the time of application.
- Business debts can be included, but DAS for businesses operates under slightly different rules from the individual scheme.
If an applicant's income is so low that no realistic repayment plan is possible, DAS may not be appropriate, and a money adviser would typically explore whether sequestration (bankruptcy) or a Minimal Asset Process (MAP) might be available instead.
Dealing with debt in Scotland?
UK Debt Team refers people to FCA-regulated debt advice firms who can explain formal options including DAS — no obligation, no judgement.
How a Debt Payment Programme Works
Once a money adviser has prepared the DPP application, it is submitted to the AiB's DAS Administrator. Creditors are notified and given 21 days to respond. A creditor can object to the programme, but the DAS Administrator has the power to approve the DPP even over a creditor's objection if the programme is considered fair and reasonable — this is known as a deemed approval.
If approved, the applicant makes a single monthly payment — usually to an approved payment distributor — who then distributes funds proportionally to each creditor. The individual no longer needs to manage separate payments or deal directly with each creditor while the DPP is active.
Duration of a Debt Payment Programme
There is no fixed maximum duration for a DPP. The length depends entirely on the total debt and what the individual can afford to pay each month. Some programmes run for a few years; others, where debts are large and income is modest, can run for considerably longer. As long as the individual maintains payments and the programme remains fair, it continues until all included debts are cleared in full.
If circumstances change — for example, a job loss or unexpected expense — the programme can be varied by the money adviser. Payments can be reduced temporarily (a payment holiday of up to six months may be possible in some cases) or the programme duration can be extended. This flexibility is one of the features that distinguishes DAS from informal arrangements, which depend entirely on creditor goodwill.
What Happens to Creditors and Enforcement Action
Once a DPP application is submitted, there is an automatic moratorium — a temporary legal pause — on most diligence (Scottish enforcement action) for six weeks while the application is processed. If the DPP is approved, this protection continues for the life of the programme.
During an active Debt Payment Programme, creditors included in the plan generally cannot pursue further enforcement action, instruct sheriff officers to carry out diligence, or obtain a charging order against the applicant's property in relation to those debts. This legal protection is one of the most practically significant aspects of DAS for people who are already facing or worried about enforcement.
It is important to note that only debts included in the programme are covered. If a new debt arises after the DPP is approved — for example, a new utility bill that goes unpaid — creditors for those debts retain their normal enforcement rights.
What Debts Can and Cannot Be Included
Most consumer debts can be included: credit cards, personal loans, overdrafts, store cards, council tax arrears, rent arrears, and utility bills. However, some debts cannot be included in a DPP. These include student loans, child maintenance payments, fines imposed by a court, and debts secured against property (such as a mortgage or secured loan).
- Eligible: Credit cards, personal loans, overdrafts, rent arrears, council tax arrears, utility arrears, catalogue debt.
- Not eligible: Mortgages, secured loans, student loans, court-imposed fines, TV licence fines, child support arrears owed to the Child Maintenance Service.
Dealing with debt in Scotland?
UK Debt Team refers people to FCA-regulated debt advice firms who can explain formal options including DAS — no obligation, no judgement.
Costs and Fees Under DAS
There is no application fee payable to the AiB for setting up a DAS Debt Payment Programme. However, a fee of 22% of each payment distributed is deducted from each monthly payment by the payment distributor. This fee is split between the DAS Administrator, the payment distributor, and the money adviser who set up the programme.
This fee structure means that although no upfront cost is charged, the overall time taken to repay debts may be slightly longer than if the full payment reached creditors without deduction. Money advisers working through the free sector (such as Citizens Advice Scotland or StepChange Scotland) may absorb part of this fee, while fee-charging regulated advisers operate under different commercial terms. The money adviser is required to explain all costs clearly before any application is made.
How DAS Compares to Other Scottish Debt Solutions
Scotland has several statutory debt solutions, and DAS sits alongside sequestration (Scottish bankruptcy), the Minimal Asset Process, and the Protected Trust Deed. Understanding the differences matters — each has distinct eligibility rules, consequences, and outcomes.
DAS vs Protected Trust Deed
A Protected Trust Deed is an insolvency process in which a trustee takes control of the debtor's assets and, after a fixed period (usually four years), any remaining debt is written off. DAS, by contrast, requires full repayment — nothing is written off. A Trust Deed will show on the insolvency register and may affect professional licences and certain employment; DAS is recorded on the DAS Register but is not an insolvency process and does not carry the same formal consequences in most areas of life.
DAS vs Sequestration (Bankruptcy)
Sequestration is the Scottish equivalent of bankruptcy. Once awarded, most unsecured debts are discharged, but the individual loses control of their assets and faces restrictions on credit and, in some cases, employment. The period of restriction is typically 12 months. DAS involves no debt write-off and no formal insolvency status — the individual retains control of their property and finances throughout, as long as payments are maintained.
DAS vs Debt Management Plans
A Debt Management Plan (DMP) is an informal arrangement, typically set up through a debt advice charity or regulated firm, in which the individual makes reduced monthly payments. Unlike DAS, a DMP has no statutory basis — creditors are not legally obliged to freeze interest or accept reduced payments, though many do. DAS provides legal certainty that a DMP cannot. However, DMPs are available across the UK, while DAS is Scotland only.
How to Access the Debt Arrangement Scheme
A DAS application must be submitted through a money adviser who is either approved by the AiB or working for an organisation authorised to provide DAS advice. Free-sector money advisers are available through Citizens Advice Scotland, StepChange Scotland, and the National Debtline service (which covers Scotland). Fee-charging regulated firms also offer DAS services.
Before any application is submitted, the money adviser must carry out a full income and expenditure assessment and explain all available options — including the alternatives to DAS — so that the individual can make an informed decision about which route fits their situation. The AiB publishes detailed guidance on the DAS process at www.aib.gov.uk.
Anyone in Scotland considering DAS, or unsure whether it is the right statutory route for their circumstances, can access free and impartial debt advice from the organisations listed below before taking any formal steps.