Alternatives to a Trust Deed in Scotland

Start with the decision

A trust deed is one option, not the default

A protected trust deed is designed for some people who cannot repay qualifying unsecured debts in full. It is not automatically the best route simply because it offers a possible write-off. The practical comparison is what happens to your monthly budget, assets, home, credit record, work and remaining debt under every realistic option.

Scotland has two broad repayment routes: the statutory Debt Arrangement Scheme (DAS) and informal arrangements with creditors. It also has two debtor-application bankruptcy routes: Full Administration and the Minimal Asset Process (MAP). A moratorium can provide temporary enforcement protection while an option is assessed, but it is not a debt solution.

• RepayDAS and informal plans normally aim to repay debt rather than write it off.
• InsolvencyA protected trust deed, MAP and Full Administration are formal insolvency processes.
• PauseA moratorium buys assessment time; it does not clear or restructure debt.

Side-by-side

Scottish debt options compared

Sources for this comparison include AiB's DAS creditor guidance, mygov.scot's bankruptcy eligibility guide and Citizens Advice Scotland's repayment guidance.

Repay with protection

Debt Arrangement Scheme (DAS)

DAS is a Scottish Government statutory debt-management scheme administered by Accountant in Bankruptcy (AiB). An approved money adviser applies for a debt payment programme (DPP) based on the person's disposable income. DAS is not bankruptcy or another insolvency process: its normal purpose is to repay the debts included in the DPP.

What DAS can do

• Combine included debts into a structured programme with one regular payment distributed to creditors.
• Protect the person from creditor recovery action on included debts while the approved DPP is maintained.
• Freeze interest, fees, penalties and other charges on included debt from the application date; if the DPP completes, those amounts are written off.
• Allow a variation where circumstances change and, where the rules are met, a crisis break or longer payment break.

What DAS does not solve automatically

A DPP may last much longer than a four-year trust deed when the affordable payment is low relative to total debt. Current bills and continuing liabilities still need paying. Some debts cannot be included, and rent or mortgage arrears can be left outside only in specified circumstances. A DPP is recorded on the DAS Register, can affect the credit file and restricts taking further credit.

If a DPP is revoked, the unpaid balances remain and interest, fees and charges that would have accrued can be added back. Sustainability therefore matters more than whether the initial monthly figure looks low. Official details are set out in the mygov.scot DAS guide and AiB's current guidance.

Formal insolvency

Full Administration bankruptcy

Full Administration is the debtor-application bankruptcy route for someone who does not qualify for MAP. Current mygov.scot guidance says a debtor applicant must owe at least £3,000, be unable to pay their debts and satisfy the Scottish connection and other application rules. An approved money adviser must complete a financial assessment before the application.

The current application fee is £150, although people with no assessed surplus income and people in specified circumstances may not have to pay. AiB decides the application and a trustee administers the bankruptcy. This is not simply a shorter payment plan: rights in assets pass into the bankruptcy estate and the trustee can realise value for creditors.

Duration is not one simple number

• The person is normally discharged from Full Administration bankruptcy after one year if they cooperate.
• A Debtor Contribution Order based on disposable income usually lasts four years and can continue after discharge.
• The trustee remains until contributions, assets and the administration have been completed.
• Bankruptcy can remain on the credit file for at least six years, while most entries remain on the Register of Insolvencies for at least five years.

Assets and restrictions

Savings, vehicles, property and other assets require individual assessment. If a home has realisable equity, the trustee can seek a sale; the court can be asked to force a sale where agreement is not possible. Bankruptcy also brings legal restrictions on credit, company directorships and certain offices or work. Read the official pages on a home in bankruptcy, income contributions and wider effects before treating discharge as the whole outcome.

Lower-asset bankruptcy

Minimal Asset Process (MAP)

MAP is bankruptcy, not a debt-management plan. It is intended for people with no disposable income and few assets. The published rules are strict and cumulative: meeting one limit is not enough.

Current headline criteria

• Total debt must be less than £25,000.
• The applicant must not own land or property.
• No single asset can normally be worth more than £1,000.
• Total assets cannot normally exceed £2,000, apart from a vehicle worth up to £3,000 that the applicant cannot do without.
• A financial assessment must show no disposable income.
• The Scottish connection and previous-bankruptcy rules must also be met.

There is currently no MAP application fee. Discharge normally occurs after six months if the criteria continue to be met and the person cooperates. The MAP entry stays on the Register of Insolvencies for 18 months from the bankruptcy date, but bankruptcy can remain on the credit file for at least six years. Debts excluded by law are not cleared simply because the route is MAP.

Because the asset limits and debt ceiling are decisive, values should not be guessed. An approved money adviser completes the assessment. See mygov.scot's current MAP criteria and the official list of examples of included and excluded debts.

Flexible, but voluntary

Informal repayment plans and debt management plans

An informal plan can be negotiated directly with each creditor or administered as a debt management plan (DMP). The payment is based on what remains after essential costs and priority debts. It can be adjusted without entering insolvency and can be useful where difficulty is temporary or the balance is repayable.

The trade-off is legal certainty. Creditors do not have to accept the offer, freeze interest or stop charges. Even after accepting an arrangement, a creditor can still use lawful recovery action. There is no automatic discharge or write-off at the end: the balance is repaid unless a creditor separately agrees otherwise.

Questions to ask before using an informal plan

• Are priority debts and ongoing household bills being paid first?
• Has each creditor confirmed the payment and interest treatment in writing?
• How long would full repayment take if interest continues?
• Is the provider free, or will fees reduce the amount reaching creditors?
• What happens if a creditor rejects the plan or circumstances worsen?

Citizens Advice Scotland confirms that creditors do not have to freeze interest and can still take court action under an agreed repayment plan. Its guide to making repayment offers also explains pro-rata offers and priority debts.

Temporary protection

Scotland's moratorium on diligence

A statutory moratorium gives six months of temporary protection from specified creditor enforcement while someone considers DAS, a protected trust deed or bankruptcy. It can prevent steps such as a new bank arrestment, earnings arrestment or creditor bankruptcy application during the protected period, subject to the detailed statutory exceptions.

A moratorium is not a repayment plan or debt write-off. It does not automatically freeze interest or charges, and ongoing liabilities remain payable. The application is recorded on the public Register of Insolvencies. Normally, only one moratorium is permitted in a 12-month period.

The time should be used to complete a budget, confirm every debt and asset, deal with emergencies and obtain approved advice. Letting six months expire without an affordable next step can leave the person with a larger balance and renewed enforcement risk. See mygov.scot's moratorium guide and AiB's notes on protection and exceptions.

Compare the whole outcome

Evidence an adviser will need

The same monthly payment can lead to very different outcomes. A defensible comparison starts with complete information rather than a preferred product.

1. Debts: balances, interest rates, arrears, court action, secured debts, joint liabilities and debts that may be excluded from a solution.
2. Essential spending: a sustainable budget, not a temporary figure created by cutting food, energy, rent or other essentials.
3. Income: stability, benefits, overtime, seasonal changes, self-employment and likely changes over the proposed period.
4. Assets: home equity, joint ownership, vehicles, savings, pensions where relevant, inheritances and expected claims or windfalls.
5. Consequences: employment rules, directorships, tenancy or mortgage terms, insurance, bank accounts, public registers and future borrowing.
6. Failure scenario: what debt, interest, costs and enforcement position would remain if the arrangement were revoked or discharge refused.

FAQ

Questions about alternatives to a trust deed

Sources

Official and public guidance checked

This page prioritises current Scottish Government, Accountant in Bankruptcy and legislation-backed guidance, with Citizens Advice Scotland used for the practical limits of informal repayment. Source pages can change after the review date.

• Accountant in Bankruptcy: DAS creditor guidance and effect of a DPP
• mygov.scot: Debt Arrangement Scheme guide
• mygov.scot: debts included and excluded from DAS
• mygov.scot: completion and revocation of a DAS DPP
• mygov.scot: Full Administration and MAP eligibility
• mygov.scot: bankruptcy income payments
• mygov.scot: discharge, contributions and register duration
• mygov.scot: credit, work and public-record effects
• mygov.scot: six-month moratorium on diligence
• Accountant in Bankruptcy: moratorium rules and exceptions
• Citizens Advice Scotland: making an informal repayment plan
• MoneyHelper: free debt advice locator

Reviewed against the linked sources on 11 July 2026.