Does a DRO Cover Council Tax?

A Debt Relief Order (DRO) is one of the most useful solutions for people on a low income with few assets — and yes, council tax arrears can go into one. Once a DRO is approved, the council and its enforcement agents have to stop collecting, and after 12 months the included debts are wiped.

Who qualifies for a DRO?

The thresholds in England and Wales are:

• Total qualifying debts under £50,000.
• Spare income under £75 a month after essential costs.
• Assets worth under £2,000 (a vehicle worth up to £4,000 can be kept on top).
• You don't own a home, here or abroad.
• You've lived or worked in England or Wales recently, and haven't had a DRO in the last six years.

There is no longer an application fee — the £90 charge was removed in 2024, so a DRO is now free to apply for through an authorised adviser.

How council tax is treated

An authorised debt adviser checks you're eligible and lists your debts, including the council tax arrears you owe up to that point. Once the DRO is approved, a 12-month protection period begins: the council and any bailiffs must stop collecting, you make no payments toward the included debts, and at the end of the year the arrears are discharged for good.

What a DRO doesn't cover, and the trade-offs

Current-year council tax, court fines, child maintenance and student loans can't go in. And there are consequences: a DRO appears on your credit file for six years and on the public Insolvency Register, and you're restricted from borrowing £500 or more without disclosure while it runs. For many low-income households, though, it's a genuine fresh start.

If a DRO doesn't fit, an IVA may — and our guide to what a Debt Relief Order is covers the basics.