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National Debtline

Advice you can trust

Personal insolvency

If you cannot afford the payments to your creditors or your assets are worth less than you total debts, you may be insolvent. There are different insolvency options that may help you deal with your debts.

Your budget

  • Don't forget that you need to work out a budget before you tackle your debt problems.
  • After you have worked out your income and outgoings you will be able to see how much you have left over.
  • If you do not have enough spare income to pay your creditors, a personal insolvency option could be suitable for you.

Business insolvency

  • Personal insolvency options deal with any personal debts you cannot afford to pay.
  • If you have business debts that you cannot pay, you will need to use a business insolvency option.
  • Business insolvency options can have very different consequences for you and your business.

Individual voluntary arrangements

  • An individual voluntary arrangement (IVA) is a legal agreement between you and your creditors to repay part of what you owe.
  • If you are a sole trader you can usually include your business and personal debts.
  • When the IVA is finished, any unpaid debt is written off.
  • We can help you set up an IVA.


Individual voluntary arrangements fact sheet



  • Bankruptcy is a way of ending your liability for debts you cannot pay.
  • Business debts can be included if you are personally liable for them. It will normally mean that your business will close.
  • Any assets you own may be sold to raise money to pay your creditors.
  • There are advantages and disadvantages to bankruptcy that you need to consider carefully.

Bankruptcy fact sheet


Debt relief orders

  • A debt relief order (DRO) may help you if you do not own your own home, have few assets and little available income to pay your creditors.
  • It is a cheaper option than bankruptcy.
  • During a DRO, most creditors cannot take action to recover your debts for 12 months.
  • After the 12 months are up, debts included in a DRO are written off.

Debt relief orders fact sheet