Debt Relief Orders (DRO) - Information & help thread

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  • Pialacyche
    Pialacyche Posts: 5 Forumite
    I have a family member who was granted a DRO over 12 months ago, so the moratorium period is over. The council have been taking deductions for rent arrears, housing benefit, and tax credits from the universal credit payments, even though these debts are included in the DRO. Are they still meant to be deducting this? Should they have been deducting for the last 12 months as well?
  • fatbelly
    fatbelly Posts: 20,457 Forumite
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    Pialacyche wrote: »
    I have a family member who was granted a DRO over 12 months ago, so the moratorium period is over. The council have been taking deductions for rent arrears, housing benefit, and tax credits from the universal credit payments, even though these debts are included in the DRO. Are they still meant to be deducting this? Should they have been deducting for the last 12 months as well?

    Rent arrears are one exception - you are allowed to make payment towards them in order to preserve your security of tenure while you are in the property to which the arrears relate.

    As for housing benefit overpayments, the DRO only gives relief during the moratorium and not after, if these were incurred by fraud.

    In order for a debt to be deemed fraudulent one of the following must apply:
    • found guilty at court
    • admitted guilt in an interview under caution
    • accepted an administrative penalty

    For TC overpayments the fraud rules also apply but there is a further problem in that if the overpayment existed but had not been deemed recoverable at the date of determination, then it is not a qualifying debt. In that case the deductions should never have stopped

    So you need to ask 'why the hell have you started taking payment again?' and challenge the response
  • Pialacyche
    Pialacyche Posts: 5 Forumite
    Many thanks fatbelly for your reply to this. Much appreciated.

    With the rent arrears, it has not really been a choice. The deductions have been made automatically throughout the moratorium period and are still going now the period is over. Am I right in saying we have the right to say they should stop?

    With the housing benefit overpayment there has been no fraud. So should the DRO have given relief during the moratorium and does it give relief now?

    For TC overpayments, again there has been no fraud. How do we determine whether the debt had been deemed recoverable?

    I am with you in asking 'why the hell have you started taking payment again?' but the problem seems to be who to ask. So far the universal credit people say that it isn't their issue and we have to ask the council. The council are not responsive. I guess we keep chasing them.
  • fatbelly
    fatbelly Posts: 20,457 Forumite
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    edited 5 December 2018 at 8:42PM
    Pialacyche wrote: »
    Many thanks fatbelly for your reply to this. Much appreciated.

    With the rent arrears, it has not really been a choice. The deductions have been made automatically throughout the moratorium period and are still going now the period is over. Am I right in saying we have the right to say they should stop?

    With the housing benefit overpayment there has been no fraud. So should the DRO have given relief during the moratorium and does it give relief now?

    For TC overpayments, again there has been no fraud. How do we determine whether the debt had been deemed recoverable?

    I am with you in asking 'why the hell have you started taking payment again?' but the problem seems to be who to ask. So far the universal credit people say that it isn't their issue and we have to ask the council. The council are not responsive. I guess we keep chasing them.
    If these are rent arrears for a property that you are living in, and the deduction is being taken at a reasonable rate then you need to be careful as you may risk a notice seeking possession - maybe run this past Shelter.

    As I said you need to ask on what basis the deductions have recommenced on the benefit overpayments. If they say that it's fraud then you point out that none of the criteria for fraud have ever existed and demand the money is refunded.

    The HB instruction came from the council and if they are as useless as mine you will need the help of your local councillor

    https://www.writetothem.com

    The TC instruction came from HMRC and if you can't get sense from them you will need your MP (same link)

    You are right that UC are just following orders.
  • Pialacyche
    Pialacyche Posts: 5 Forumite
    Thanks fatbelly. We're going to try Universal Credit to work out what debts they have on file, then we're calling the local council to see about the DRO and whether they've taken that into consideration. And then we'll try the councillors and then MP. Thanks again and fingers crossed.
  • Super_Trouper
    Super_Trouper Posts: 928 Forumite
    fermi wrote: »
    Info from Government website: https://www.gov.uk/government/publications/getting-a-debt-relief-order/getting-a-debt-relief-order
    This is a dead link.

    The written text if you highlight and copy IS working, but the actual link pointing to http://www.insolvency.gov.uk/bankruptcy/alternativestobankruptcy.htm is a deadlink and needs updating to the text of the link.
  • fatbelly
    fatbelly Posts: 20,457 Forumite
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    Super_Trouper wrote: »
    This is a dead link.

    The written text if you highlight and copy IS working, but the actual link pointing to http://www.insolvency.gov.uk/bankruptcy/alternativestobankruptcy.htm is a deadlink and needs updating to the text of the link.

    Try this

    https://www.gov.uk/government/publications/getting-a-debt-relief-order/getting-a-debt-relief-order
  • sourcrates
    sourcrates Posts: 28,848 Ambassador
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    Super_Trouper wrote: »
    This is a dead link.

    The written text if you highlight and copy IS working, but the actual link pointing to http://www.insolvency.gov.uk/bankruptcy/alternativestobankruptcy.htm is a deadlink and needs updating to the text of the link.
    fatbelly wrote: »
    Try this

    https://www.gov.uk/government/publications/getting-a-debt-relief-order/getting-a-debt-relief-order

    Updated the link, thanks both.
    I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter
  • Linny123
    Linny123 Posts: 7 Forumite
    Need advice please !! I have a dro granted 12th dec I got £100 for Christmas off family to spend but stupidly played online bingo using it over 2 months winning max £100 and just re depositing winnings so looks like loads of transactions 🤦🏼!♀️ I’m now scared as I got an arrears letter randomly last week even though I told them I had dro and when I went to play bingo today (just randomly as free promotions bank declined it !!!) I know I shouldn’t of played but I don’t smoke I don’t drink I don’t go out anywhere other than baby groups with little one so it was just something for me to do that I enjoy by the way I don’t gamble all the time and massive amounts . And I have never won much so scared anxiety is kicking in but still on the insolvency register when checked today xxx
  • fatbelly
    fatbelly Posts: 20,457 Forumite
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    Linny123 wrote: »
    Need advice please !! I have a dro granted 12th dec I got £100 for Christmas off family to spend but stupidly played online bingo using it over 2 months winning max £100 and just re depositing winnings so looks like loads of transactions 🤦🏼!♀️ I’m now scared as I got an arrears letter randomly last week even though I told them I had dro and when I went to play bingo today (just randomly as free promotions bank declined it !!!) I know I shouldn’t of played but I don’t smoke I don’t drink I don’t go out anywhere other than baby groups with little one so it was just something for me to do that I enjoy by the way I don’t gamble all the time and massive amounts . And I have never won much so scared anxiety is kicking in but still on the insolvency register when checked today xxx

    I don't think you've done anything fatal to your DRO. But you are playing with fire and you need to stop. There is another thread here where someone got a ppi payment (not asked for) of just over £2000 and got their DRO revoked, with all the debts coming back, and banned from having another DRO until 6 years after the first one.

    If you got winnings of over £1000 you are required to declare them and I would imagine the Insolvency Service would not be lenient. Over 2k and the rules kick in in full.

    Your creditors are allowed to send letters during the moratorium but they are not allowed to demand money.
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