Protected Trust Deeds are only available for people who live in Scotland

It offers affordability, flexibility and protection from your creditors. Should you enter into a Protected Trust Deed, you will make one monthly payment to an Insolvency Practitioner who collects your payments and negotiates the sale of any valuable assets you own, distributing the money collected to your creditors.

If you have unsecured debts of over £5,000 and are able to make a contribution towards your debts a Trust Deed could be the most suitable option for you.


  • Any correspondence from your creditors will be handled on your behalf so pressure is taken away from you
  • You repay what you can afford in one single monthly repayment
  • On completion of your Protected Trust Deed, which takes a minimum 4 years, you will be debt-free from the debts that were included in your Protected Trust Deed
  • If your wages are being arrested this will be lifted.

Things you need to know

  • You must be open and honest so that the appropriate arrangements are made for you
  • If you fail to fulfil the terms of the Protected Trust Deed, this could lead to bankruptcy and your home and other assets may be at risk
  • If you are required to release equity from your property, your ability to obtain a remortgage may be restricted. If you are unable to secure a remortgage to release any equity in your home, your debt solution may be extended
  • There will be restrictions placed on your expenditure while you are in a Trust Deed
  • If you are self-employed your existing suppliers may be reluctant to trade with you.  Your monthly contribution will take account of your annual liability for income tax.
  • All fees payable to your Trustee are taken from your monthly contributions and assets that are realised.  You will not be charged separately for any fees. Any fee charged would be agreed with your creditors and would be fully explained to you before you commit to this debt solution. Please visit our important information page for further details on Protected Trust Deed fees

For more information on protected trust deeds, read our questions and answers.

Questions & Answers

What is a Trust Deed?

A Protected Trust Deed is a legally binding contract between your creditors and you where you agree to make a regular contribution from your income and to surrender certain valuable assets to your Trustee.

The Trustee negotiates with your creditors on your behalf and pays them an agreed proportion of the amount you owe them. It’s an alternative to sequestration (the Scottish equivalent to bankruptcy) and is administrated by a licensed Insolvency Practitioner.

The terms of your proposal to creditors can be flexible, but creditors will reasonably expect their prospects of recovering money under a Trust Deed to be at least as good as with sequestration proceedings.

What are the advantages of a Trust Deed?

The benefits of a Trust Deed are:

  • All pressure from creditors is removed as your Trustee handles all correspondence from them on your behalf
  • You will only repay what you can reasonably afford after living expenses have been deducted
  • After completing a Trust Deed, which normally takes 4 years, you will be debt-free from the debts that were included in your Protected Trust Deed and ready to start afresh financially

How much will a Protected Trust Deed cost me?

During the negotiations with your creditors, fees will be agreed. You will be informed of the fees your Trustee will receive before you commit to a Protected Trust Deed.

You then make monthly contributions and create a pot of cash for your creditors. Your Trustee will take their fees from the pot – you do not receive a bill at any stage, you just pay the contributions you can afford.

Please visit our important information page for further details on Protected Trust Deed fees.

How do I enter into a Trust Deed?

To succeed, the following guidelines would normally be expected:

  • you owe at least £5,000 of unsecured debt to a minimum of 2 different creditors
  • you must be in paid secured employment (Employed / Self Employed)
  • you must be able to afford a consistent monthly contribution

If you sign a Protected Trust Deed, you will be transferring all of your valuable assets to a Trustee. Assets may include any equity in your home, cars, investments or any other significant assets.

Details of your Trust Deed will appear online in the Register of Insolvencies which is publically available to view.

Provided that no more than one third in value or a majority number of your creditors object to the terms proposed, the Trust Deed will become “Protected” and your creditors can then no longer pursue you for money you owe to them. Neither can they take another legal debt recovery action.

How long does it take to get a Trust Deed?

]The initial signing of a Trust Deed can be completed within a couple of days. After a telephone consultation, documentation will be sent to you. At this point, you are under no obligation to sign and if you change your mind we can advise you on an alternative solution.

After you have signed the Trust Deed, it takes around 6 weeks for the creditors to accept the proposal.

How long does a Trust Deed last?

A Protected Trust Deed normally lasts for 4 years.

Will all my debts be included in a Protected Trust Deed?

Your Protected Trust Deed will only include your unsecured debts such as unsecured loans, credit cards, store cards, rent arrears and overdrafts. Your mortgage or any other secured loans you have will not be included.

What if I have joint debts with my partner? Can I have a joint Trust Deed?

Contrary to popular belief, there is no such thing as a joint Trust Deed. A Trust Deed is an agreement between an individual and their creditors. If you have joint debts with your partner (or someone else) and you both enter into individual Trust Deeds, the joint debts will be included in each Trust Deed for the whole balance. For example, if you have a joint loan of £10,000 with your partner, then £10,000 will appear as a creditor in your Trust Deed and £10,000 will also appear as a creditor in your partner’s Trust Deed.

If you have joint debts with your partner but only you are entering into a Trust Deed, you should be aware that the joint creditors can pursue your partner for the full amount of the debt, despite the balance being included in your Trust Deed. You should therefore consider if your partner can afford to repay the debt in full and, if not, whether they need to think about taking separate advice in relation to their debts.

Once I have agreed to a Trust Deed, is it always accepted by the creditors?

Once you have signed a Trust Deed, your proposal will be sent to all your creditors and they are given approximately 5 weeks to agree or object to the proposal. If your creditors agree to the proposal (no response is accepted as agreement), the Trust Deed becomes “Protected” and at this point you have complete protection from your creditors.

Will I lose my home and car?

The only interest the Trustee will take in your home is in any equity available to you. A valuation of the property will be carried out, and the level of any equity established.

Again, in terms of your vehicles, the Trustee’s interest will only be in any equity. If it is subject to a hire purchase agreement, only the difference between the value of the car and the outstanding hire purchase amount will be required to be contributed to the Trust Deed.

If you need your car to travel to and from work, you will normally be allowed to retain it and continue to make payments to the company you have your hire purchase agreement with.

Do I need to change my bank account?

You should not bank with a creditor that you owe money to because the creditor is entitled to offset any credit balance on your account against money you owe them. It is important you arrange for your salary to be paid into your new account so that your creditor does not take the credit balance from your account when your salary is paid in.

It is also recommended that you do not operate an overdraft.

Should I continue to pay my creditors up until I sign the Trust Deed?

If you can afford to make a nominal sum to your creditors, you can do so. However, if you cannot afford a payment, explain to the creditor that you are in the process of signing a Trust Deed and ask them to put your account on hold.

Should I expect my creditors to continue to contact me?

Yes, this is likely. Creditors can take a while to update their systems with details of the Trust Deed. Your creditors will be contacted as soon as your Trust Deed is approved, however, let your Trustee know about any calls or correspondence from them.

Will anyone know I am in a Protected Trust Deed?

Details of your Trust Deed will appear online in the Register of Insolvencies which is publicly available to view.

Does my employer need to know about my Trust Deed?

There is no need for your employer to know that you have signed a Trust Deed. However, in extreme cases, if you do not adhere to the terms and conditions of your Trust Deed and make your monthly repayments as agreed, your Trustee may contact your employer.

Your employer may be contacted if, for any reason, your Trustee cannot contact you at your home address so it is very important you keep them updated with any changes to your contact details.

Does my partner need to know about my Trust Deed?

There is no specific reason that your partner needs to find out about your Trust Deed. However, it is likely your partner will find out about the Trust Deed if there is a joint creditor and the creditor issues correspondence discussing the overall circumstances, or if there are joint assets, such as equity in a jointly owned property, as certain documents would require their agreement and signature.

What happens if I win the lottery or inherit a sum of money during my Trust Deed?

All money won or inherited should be declared to your Trustee. If there are sufficient funds to repay all creditors in full plus interest, plus pay your Trustee’s fees, your Trustee will arrange for this to happen and the remainder will then be returned to you.

What effect does a Trust Deed have on my credit file?

The Trust Deed itself is not noted on your credit file, however, if you are ready to sign a Trust Deed, your credit file presumably already has a default notice. Any default notices will stay on your credit record for six years and after that, your creditors should mark the debts as being satisfied.

How do I contact you?

Take the first step to turning your debt around. Complete our online debt enquiry form and we will advise whether we can help you with a debt solution and arrange a time to contact you to talk through the options.