If you live in Scotland, the debt solutions are different from those in England, Wales and Northern Ireland. The trust deed is Scotland’s nearest equivalent to an IVA.
The short answer
- A trust deed is a formal agreement with creditors, run by an insolvency practitioner as trustee.
- You usually need debts of at least £5,000.
- It typically lasts four years.
- It becomes protected unless enough creditors object within five weeks.
- It’s registered with the Accountant in Bankruptcy (AiB).
How does a trust deed work?
You transfer your assets to a trustee, who collects monthly payments based on what you can afford and pays your creditors. If the trust deed becomes protected, creditors can’t take further action, and qualifying debt left at the end is written off.
When does it become protected?
The trust deed is published in the Edinburgh Gazette. It becomes protected unless a majority of creditors by number, or creditors holding at least a third of the debt, object within five weeks.
What about my home?
If you own your home, the trustee will look at your equity. You may be asked to release equity during or at the end of the trust deed. Get specialist Scottish advice before agreeing.
What other options are there in Scotland?
The Debt Arrangement Scheme lets you repay in full with interest frozen. Sequestration is Scotland’s version of bankruptcy, and the Minimal Asset Process (MAP) is a lower-cost route for people with few assets. For figures, see our Scottish insolvency statistics.
Common questions
Can I get an IVA in Scotland?
No. IVAs are only available in England, Wales and Northern Ireland. In Scotland, the closest equivalent is a protected trust deed.
How long does a trust deed last?
Typically four years, though it can be longer depending on your circumstances.
Does a trust deed affect my credit file?
Yes. It stays on your credit file for six years and is listed on the Register of Insolvencies.
Getting help
You don’t have to deal with debt on your own. Free, impartial advice is available from MoneyHelper, StepChange and National Debtline. If you want to talk through whether a formal solution such as an IVA could be suitable, you can also get in touch with us.