Types of debt
The kind of debt you owe decides what a creditor can do if you fall behind and which solutions can deal with it. Start with the debts that put your home, your energy supply or your income at risk.
Most people who are struggling owe several kinds of debt at once: a credit card, a catalogue, some council tax, perhaps a loan from a friend. The law treats these very differently. Knowing which kind you have tells you what the creditor can do if you stop paying, which debts to deal with first, and which debt solutions can include them.
Which debts are priority debts?
Priority debts are the ones where not paying has the most serious consequences: losing your home, losing your energy supply, or the creditor having fast routes to bailiffs or to deductions from your wages or benefits. They usually include:
- rent and mortgage arrears
- council tax arrears (domestic rates in Northern Ireland)
- gas and electricity arrears
- magistrates’ court fines
- child maintenance
- TV licence
- tax owed to HMRC
- hire purchase for something you need, such as a car you use for work
Non-priority debts include credit and store cards, catalogues, personal and payday loans, overdrafts, buy now pay later and money owed to friends or family. In England and Wales, water arrears are usually non-priority too, because a water company cannot cut off a home. For non-priority debts, a creditor has to take you to court and get a judgment before it can use bailiffs. The most common mistake is paying whoever chases hardest and letting the rent or council tax slip. Priority and non-priority debts explains the difference in more detail.
Why does the type of debt change your options?
Three things change from one kind of debt to another.
- What the creditor can do. A council can get a liability order from the magistrates’ court and then use bailiffs or take money from your wages or benefits. An energy supplier can, under strict rules, move you to a prepayment meter. A landlord can go to court for possession. A card lender has to get a county court judgment first.
- Which rules protect you. Lenders regulated by the Financial Conduct Authority must treat people in arrears with forbearance and due consideration, which can mean freezing interest or accepting lower payments. Energy suppliers follow Ofgem’s rules, and councils follow the council tax regulations.
- Whether a debt solution can include it. Most unsecured debts can go into an IVA, a debt relief order (DRO) or bankruptcy. A few cannot, and some keep their force even when they are included.
Which debts can go into an IVA, DRO or bankruptcy?
This summary is for England and Wales. Northern Ireland has its own IVAs, DROs and bankruptcy with similar rules. Scotland has no IVAs or DROs: see debt solutions in Scotland.
| Debt | IVA | DRO | Bankruptcy |
|---|---|---|---|
| Credit and store cards, catalogues, loans, overdrafts, payday loans, buy now pay later | Yes | Yes | Yes |
| Council tax arrears | Yes | Yes | Yes |
| Gas, electricity and water arrears | Yes | Yes | Yes |
| Rent arrears | Only if the landlord agrees, which is unusual | Yes, but the landlord can still seek possession | Yes, but the landlord can still seek possession |
| Magistrates’ court fines | No | No | No, fines are not released |
| Student loans | No | No | No |
| Child maintenance arrears | No | No | Usually not |
| Mortgages and secured loans | Only if the lender agrees, which is rare | No | No, the lender can still rely on its security |
Any solution deals with what you owe when it starts, not with bills that fall due afterwards, so your current rent, council tax and energy still have to be paid. For the detail on IVAs, see what debts can and cannot go into an IVA. To compare the solutions themselves, including costs and effects on your home, see debt solutions compared.
A Breathing Space is different again. It pauses most creditor action and freezes interest and charges on most debts for up to 60 days while you get advice. It does not cover court fines or student loans, and it covers council tax only once it is in arrears.
How this section is organised
The guides below are grouped by the kind of debt:
- Household bills: council tax arrears and liability orders, rent arrears, and gas, electricity and water.
- Borrowing: credit cards, payday loans, buy now pay later, catalogues and store cards, and loan sharks. If you have borrowed from an unlicensed lender and feel unsafe, read borrowed from a loan shark? first.
- Tax, benefits and fines: HMRC, DWP debt recovery, benefit overpayments, court fines and student loans.
- Other situations: gambling, business debts, and what happens to debt when someone dies.
Each guide says whether the debt is a priority, what the creditor can do, and whether it can go into an IVA, DRO or bankruptcy. Free, impartial debt advice is available from MoneyHelper, StepChange, Citizens Advice and National Debtline, and an adviser can look at all your debts together: see where to get free debt advice.
Not sure which option fits? Answer a few questions and we can point you in the right direction. It takes about 3 minutes, and it is free and confidential.
If you use our checker, we may pass your details to a licensed insolvency practitioner or debt adviser.
Household bills
- Council tax arrears: what happens and what to do How councils recover arrears in each part of the UK, and how council tax fits with your other debts.
- What is a council tax liability order? What the summons and hearing mean, what the council can do next, and how the order fits with debt solutions.
- What to do about rent arrears Eviction rules for arrears, help with rent, and why arrears need special care in an IVA, DRO or bankruptcy.
- Gas, electricity and water debt Payment plans, prepayment meter rules, help schemes, water debt, and energy debt in an IVA or DRO.
Borrowing
- Credit card debt: your options Persistent debt letters, minimum payments, balance transfers and formal solutions for card debt.
- Payday loan debt: what to do if you cannot repay The price cap, stopping payments from your account, complaints and payday loans in a debt solution.
- Klarna and buy now pay later debt: what to do The 2026 BNPL rules, missed payments, debt collection and buy now pay later in an IVA, DRO or bankruptcy.
- Catalogue and store card debt Missed payments, persistent debt rules, arrangements and catalogue debt in an IVA, DRO or bankruptcy.
- Borrowed from a loan shark? What to do Staying safe, reporting an illegal lender in confidence, and getting support in every UK nation.
Tax, benefits and fines
- Owe HMRC money? Time to Pay and your options Time to Pay, online payment plans, HMRC collection powers and tax debt in an IVA, DRO or bankruptcy.
- DWP Debt Management: what it is and what to do Why DWP Debt Management writes to you, how it collects, how to pay less, and DWP debt in an IVA or DRO.
- Universal Credit and benefit overpayments: what to do When overpayments must be repaid, how to challenge them, deduction limits, and overpayments in an IVA or DRO.
- Unpaid magistrates' court fines: what to do Paying a fine, wage and benefit deductions, enforcement, and why fines stay outside debt solutions.
- Student loan debt: repayments and debt solutions Repayment thresholds for 2026/27, mortgage-style loans, and how student loans sit alongside debt solutions.
Other situations
- Gambling debt: where to get help and your options Support for gambling harm, blocking tools, dealing with the debts, and how gambling affects debt solutions.
- Business and self-employed debt: your options Who is liable for business debts, which to deal with first, free help, and business debt in debt solutions.
- What happens to debt when someone dies? Who pays debts after a death, what executors must do, insolvent estates, and how to tell creditors.
Common questions
Is council tax a priority debt even if I owe a lot on credit cards?
Yes. Council tax arrears can lead to bailiffs, deductions from your wages or benefits and, in England, prison in rare cases. Card lenders have to go to court first, so council tax usually comes before them.
Can one debt solution deal with all my debts?
Often most of them, but rarely all. Fines, student loans, child maintenance and secured debts are usually left out, and rent arrears need special care, so check each debt with a debt adviser.
Do I have to keep paying my current bills in a debt solution?
Yes. An IVA, DRO or bankruptcy deals with what you owe at the start. Rent, council tax, energy and other bills that fall due afterwards still have to be paid.