Breathing Space: The 60-Day Legal Shield Against Creditors

What Is Breathing Space?

The Breathing Space scheme — officially called the Debt Respite Scheme — was introduced by the UK government in May 2021. It gives people in problem debt legal protection from creditor action for 60 days. During this period, three things happen simultaneously:

1. Interest and charges are frozen. No new interest accrues on qualifying debts for the full 60 days.
2. Enforcement action stops. Bailiffs must stand down. County Court Judgment enforcement is paused. Creditors cannot contact you to demand payment.
3. You get time to plan. A qualified debt adviser works with you during the 60 days to build a sustainable, long-term solution.

Breathing Space is not a debt solution in itself. It is a legally enforced pause — time to think, time to breathe, time to work with a professional without the constant pressure of creditor contact, accruing interest, and enforcement threats.

Who Can Apply?

Eligibility is straightforward:

• You must be an individual (not a company or partnership)
• You must be unable to pay your debts as they fall due or be likely to become unable
• You must not have had a Breathing Space in the previous 12 months
• You must not currently be in a formal debt solution (IVA, DRO, bankruptcy)

Important: You cannot apply for Breathing Space yourself. A qualified debt adviser must apply on your behalf. This can be done through:

• StepChange — 0800 138 1111 (free)
• Citizens Advice — online or in person
• National Debtline — 0808 808 4000 (free)
• Any FCA-authorised debt advice provider

The adviser assesses your situation, confirms eligibility, and submits the application electronically through the Insolvency Service's Breathing Space register. Once registered, all qualifying creditors are notified automatically.

What Debts Are Covered?

Breathing Space covers most personal debts. Here is a breakdown:

Covered:

• Credit cards, store cards, and catalogue debts
• Personal loans and overdrafts
• Council tax arrears (but not ongoing liability)
• Utility bill arrears (gas, electricity, water)
• HMRC debts (income tax, National Insurance, VAT)
• Benefit overpayments
• Buy Now Pay Later debts
• Guarantor loan debts
• Money owed to private individuals

NOT covered:

• Ongoing council tax (only arrears are included)
• Child maintenance (CMS/CSA)
• Student loans
• Debts incurred through fraud
• Crisis loans from the Social Fund
• Court-imposed fines (criminal fines) in some circumstances
• Secured debts (mortgages) — although mortgage arrears may qualify in some cases

What Happens During the 60 Days?

Once Breathing Space is active, you have obligations:

You must:

• Continue making any payments you can afford (your adviser will help determine what this means)
• Engage with your debt adviser — attend appointments, provide information, respond to communications
• Not take on additional debt that you cannot afford to repay
• Notify your adviser of any significant change in circumstances

You must NOT:

• Ignore your adviser's communication
• Take on new credit you cannot repay
• Use the 60 days as a "holiday" from dealing with your situation

If you breach these conditions, a creditor can apply to the Insolvency Service to have your Breathing Space cancelled. This is rare in practice, but it underlines the importance of engaging genuinely with the process.

During the 60 days, your adviser will help you complete a full financial assessment, typically using the Standard Financial Statement, and explore which long-term solution is right for you — whether that is a Debt Management Plan, an IVA, a DRO, informal negotiation, or simply better budgeting.

The Numbers: How Much Can Breathing Space Save?

The interest freeze alone can save significant money. Here is what 60 days of frozen interest looks like on common UK debts:

For someone with £18,000 in mixed debt, Breathing Space saves over £600 in interest in just two months — money that would otherwise have been added to their debt pile. And that does not include the value of having enforcement action stopped, which reduces stress and prevents costly escalation.

Mental Health Crisis Breathing Space

A separate, stronger version exists for people receiving mental health crisis treatment. Mental Health Crisis Breathing Space provides:

• No fixed time limit — it lasts for the duration of your crisis treatment plus 30 days
• Broader protections — even stricter limits on creditor contact
• Automatic renewal — if your treatment continues, the protection continues

Your Approved Mental Health Professional (AMHP), crisis team, or care coordinator can trigger this. You do not need to apply through a debt adviser, although having one is recommended.

The Money and Mental Health Policy Institute campaigned for this provision, recognising that financial crisis and mental health crisis are deeply intertwined. If you are in a mental health crisis and have debt, this protection exists specifically for you.

Since its introduction, Mental Health Crisis Breathing Space has been used thousands of times to protect vulnerable individuals from creditor pressure during their most difficult moments. If you are supporting someone in mental health crisis who also has debt, raising the possibility of this scheme with their care team could significantly reduce their burden. The scheme is specifically designed to ensure that nobody has to deal with creditor pressure while receiving urgent mental health treatment — financial recovery can begin once clinical recovery is established.

What If a Creditor Breaches Breathing Space?

Breathing Space is legally binding. If a creditor contacts you to demand payment, charges interest, or takes enforcement action during the 60-day protected period, they are breaking the law. Here is what you can do:

1. Tell your debt adviser immediately. They can contact the creditor and remind them of their legal obligations.
2. Report the breach to the Insolvency Service. The Insolvency Service maintains the Breathing Space register and has the power to enforce compliance.
3. Escalate to the Financial Ombudsman Service. If the creditor is FCA-regulated (most banks and credit card companies are), the Financial Ombudsman can investigate and potentially award compensation.
4. Apply for a court order. In serious cases, the court can order the creditor to reverse any charges or enforcement actions taken during the breach.

In practice, most creditors comply immediately once they are notified of Breathing Space. The system is electronic — creditors receive automatic notification through the Insolvency Service's register. Breaches are relatively rare and usually result from administrative errors rather than deliberate violations.

Keep records of any contact from creditors during Breathing Space. Save letters, note phone call dates and times, and screenshot any emails or texts. This evidence is essential if you need to escalate a breach.

Common Questions About Breathing Space

Will it affect my credit score? Yes, indirectly. Breathing Space itself is not recorded on your credit file, but the debts included may be marked as "in arrangement" or "in default" by creditors. However, if you are already missing payments, your credit score is already affected — Breathing Space does not make it worse.

Can my landlord evict me? Breathing Space does not cover rent arrears directly (rent is not a regulated debt). However, if your landlord has obtained a court order for money owed, that enforcement can be paused during Breathing Space.

What about joint debts? If you have a joint debt, Breathing Space only protects your share. Your co-borrower can still be pursued for the full amount. This is an important consideration for couples.

Can I apply more than once? You cannot have a second Breathing Space within 12 months of the first one ending. After 12 months, you can apply again if your circumstances warrant it.

What Happens After the 60 Days?

When Breathing Space ends, you should have a plan in place. The 60 days is a window, not a destination. Common outcomes include:

• Debt Management Plan (DMP): Reduced monthly payments to all creditors, often with interest frozen indefinitely. Free through StepChange.
• Individual Voluntary Arrangement (IVA): A legally binding 5-6 year plan with remaining debt written off at the end.
• Debt Relief Order (DRO): For those with debts under £30,000 and minimal assets. Qualifying debts written off after 12 months.
• Informal arrangements: Your adviser may negotiate directly with creditors for reduced payments or interest freezes without a formal solution.

If you do not have a plan in place when Breathing Space ends, interest and charges resume immediately. Creditors can restart enforcement. This is why engaging actively with your adviser during the 60 days is so important.

Next Step

If you think Breathing Space could help you, contact StepChange on 0800 138 1111 or Citizens Advice. They can assess your eligibility and start the application process. For more detail on all UK debt solutions, see our UK Debt Solutions Compared guide.