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What Is the Breathing Space Scheme?
For anyone being chased by creditors, receiving demands for payment, or watching interest and charges mount up, finding a moment to take stock and seek proper advice can feel impossible. The Breathing Space scheme — formally the Debt Respite Scheme — exists precisely to create that moment. Introduced under the Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales) Regulations 2020, the scheme came into force on 4 May 2021.
Once a Breathing Space is in place, most creditors are legally prevented from contacting the individual to chase payment, applying new interest or charges, and taking enforcement action. This gives the individual time to access regulated debt advice and explore formal options without their situation deteriorating further during that period.
The scheme is administered by approved debt advisers — typically regulated firms, charities, and local authorities — and is not something a person can apply for directly themselves. According to GOV.UK, only a debt advice provider that is authorised by the FCA or a local authority can register a Breathing Space on someone's behalf.
The Two Types of Breathing Space
There are two distinct versions of the scheme, each designed for different circumstances.
Standard Breathing Space
A Standard Breathing Space lasts for 60 days. During this period, most qualifying debts are protected — meaning creditors cannot add interest, fees, or penalties to the debt, and enforcement action is paused. The individual must be receiving debt advice from an approved adviser throughout the moratorium.
According to GOV.UK, a Standard Breathing Space can only be registered once in any 12-month period for the same individual. This prevents the scheme from being used repeatedly as a way of indefinitely deferring debt obligations.
Mental Health Crisis Breathing Space
A Mental Health Crisis Breathing Space is available to individuals who are receiving treatment from a mental health crisis team or an approved mental health professional. This version of the scheme lasts for the entire duration of the mental health crisis treatment, plus 30 days. There is no fixed upper time limit in the same way as the Standard Breathing Space, meaning protection can continue for as long as crisis treatment continues.
According to the Regulations, there is no restriction on how many times a Mental Health Crisis Breathing Space can be applied for, reflecting the unpredictable and recurring nature of serious mental health conditions.
Wondering if Breathing Space applies to you?
We refer you to FCA-regulated specialists who can review your situation properly and explain which options may be available.
Who Is Eligible for a Breathing Space?
To be eligible for a Standard Breathing Space, a person must be an individual (not a company or partnership) who lives in England or Wales, has at least one qualifying debt, and is receiving debt advice from an approved adviser. According to GOV.UK, the person must not be subject to a current debt relief order (DRO), individual voluntary arrangement (IVA), bankruptcy order, or debt management plan administered under a formal statutory scheme at the time of application.
For a Mental Health Crisis Breathing Space, the individual must additionally be receiving treatment from a mental health crisis team or be detained or treated under the Mental Health Act 1983. Evidence of this treatment is required, and the application is typically made by a nominated person (such as a carer or social worker) rather than the individual themselves.
Debts That Qualify
Most personal debts qualify for Breathing Space protection, including:
- Credit cards and store cards
- Personal loans and overdrafts
- Utility arrears (gas, electricity, water)
- Council tax arrears
- Rent arrears
- HMRC debts including tax credit overpayments
- Benefit overpayments
- Mortgage or secured loan arrears (though the underlying security cannot be protected)
Certain debts are excluded from Breathing Space protection. According to GOV.UK, these include secured debts where the creditor is seeking to enforce the security itself (such as repossession of property), debts incurred through fraud, child maintenance arrears, damages awarded by a court for personal injury caused by the debtor, and certain student loans in specific circumstances. A regulated debt adviser can confirm which of a person's specific debts qualify.
What Happens During a Breathing Space?
Once an approved adviser has registered a Breathing Space with the Insolvency Service, creditors are notified. From that point, the legal protections come into effect. According to GOV.UK, creditors are required to stop adding interest, fees, and charges to qualifying debts. They must also cease enforcement action and cannot contact the debtor directly to demand payment on qualifying debts during the moratorium.
Creditors do retain limited rights: they can still apply to the court to have the Breathing Space reviewed or cancelled in certain circumstances — for example, if they believe the individual does not meet the eligibility criteria or if the individual's circumstances have changed materially.
The individual's obligations during the period are also clearly set out. They are expected to engage with their debt adviser, respond to reasonable requests for information, and not take on significant new debt. If they fail to do so, the adviser has the ability to cancel the Breathing Space. If the individual enters a formal debt solution during the 60-day period (such as an IVA or DRO), the Breathing Space ends automatically on that date.
What a Breathing Space Does Not Do
It is important to understand that a Breathing Space does not write off or reduce debt. The debts remain owed in full once the moratorium ends. The scheme's purpose is to provide protected time for someone to access advice and put a longer-term solution in place — not to act as a standalone debt solution itself.
Some creditors may choose to pause certain communications voluntarily, but during the moratorium they are legally required to comply. Once the Breathing Space ends, if no formal debt solution has been put in place, creditors can resume contact and enforcement action.
How to Apply for a Breathing Space
An individual cannot apply for a Breathing Space directly. The application must be made by a debt adviser who is either FCA-authorised to provide debt counselling, or a local authority. According to GOV.UK, approved advisers include regulated debt advice charities and commercial debt advice firms with the appropriate FCA permissions.
The process begins with the person contacting an approved debt advice provider. The adviser will assess whether the individual meets the eligibility criteria, identify which debts qualify, and then register the Breathing Space with the Insolvency Service's online portal. The Insolvency Service then notifies creditors electronically in most cases.
Free debt advice — including the ability to register a Breathing Space — is available from MoneyHelper (moneyhelper.org.uk), StepChange Debt Charity, Citizens Advice, and National Debtline. These organisations provide regulated debt advice at no charge to the client and can assess eligibility for the scheme.
What Comes After a Breathing Space?
The 60-day window of a Standard Breathing Space is intended to give someone enough time to properly assess and begin a formal debt solution. A regulated debt adviser will typically use this period to review the person's full financial situation, explain which formal options may be available, and (where appropriate) begin the process of entering one.
Formal debt solutions available in England and Wales include Debt Relief Orders (DROs), Individual Voluntary Arrangements (IVAs), and bankruptcy. For those with manageable but multiple debts, a Debt Management Plan (DMP) may also be considered. Each of these works very differently in terms of eligibility, cost, duration, and effect on credit files and assets — a regulated adviser is best placed to explain how each works in general terms and what the process involves.
If the Breathing Space ends without a formal solution in place — because the person decided not to proceed with one, or was found not to qualify — all debts and the associated interest and enforcement rights revert to their previous status. Creditors may then resume any action that was paused.
Breathing Space and the Wider Debt Landscape
The Debt Respite Scheme was introduced as part of a broader government recognition that people in serious debt often struggle to access help before their situation becomes significantly worse. According to GOV.UK, the scheme was designed to complement — not replace — existing formal insolvency and debt management routes.
For someone in debt who has not yet taken any formal steps, a Breathing Space can provide critical breathing room. It stops the clock on escalating charges and gives a structured, legally protected window to engage with regulated advice. For those already in a mental health crisis, the extended protections reflect the reality that decision-making capacity may be significantly reduced and that time — more than 60 days — may be needed before someone is in a position to engage with their finances at all.
Understanding the scheme's scope — what it covers, what it does not, and how it interacts with other debt solutions — is an important first step for anyone considering whether it might be relevant to their circumstances. Free advice from one of the organisations listed below is the appropriate next step for anyone who wants to assess their eligibility.