Stop and Restart Deductions from Benefits
The UK Debt Respite Scheme allows someone with a debt problem to get some legal protection from their creditors.
Are you a creditor or a money adviser that asked the DWP to deduct payments from someone’s benefit to repay the debt?
If so, you need to notify DWP if the claimant asks you to stop recovering a debt under the Debt Respite Scheme (‘Breathing Space’).
The Insolvency Service notifies creditors and money advisers when debtors are in ‘Breathing Space’. As a result, you would need to stop all action to recover the debt and any charges attached to it (e.g. interest).
Also, you would not be able to make new applications for debt deductions from welfare benefits while the debtor remains in a ‘Breathing Space’.
Standard ‘Breathing Space’
The maximum length of time for a standard ‘Breathing Space’ is sixty (60) days. Even so, debtors can only have one (1) in any given 12-month period.
Mental Health Crisis ‘Breathing Space’
The recovery period can last for as long as you receive treatment (plus thirty days) if an Approved Mental Health Professional (AMHP) certifies you are receiving mental health crisis treatment.
In these situations, the Department for Work and Pensions (DWP) would need to stop debt deductions from these benefits:
- Income-based Jobseeker’s Allowance (JSA)
- Income-related Employment and Support Allowance (ESA)
- Income Support
- Pension Credit
Note: The main section contains more information about heating benefits and household energy grants (e.g. the Winter Fuel Payment).
So-called ‘third party deductions‘ for ongoing fuel charges and Water Direct (water charges) will not stop during a ‘Breathing Space’.
Debts Deducted from Universal Credit
If the debt is being taken from Universal Credit payments there is no need to inform the DWP. The Debt Respite Scheme does not cover deductions from Universal Credit at the moment [May 2021].
Tell the DWP a ‘Breathing Space’ has Started
The first step is filling in the creditor template below and list all debtors who are in a ‘Breathing Space’. There is no need to fill in the end date unless you already know it.
- DWP Debt Respite Scheme (‘Breathing Space’) creditor template [open document format]
- Mail: [email protected]
Important: Do not delay sending the creditor template to the Department for Work and Pensions (i.e. send it as soon as you know a debtor is taking a payment break).
The DWP will confirm when the deductions have stopped. Likewise, they will contact you if they need any further questions answering.
Important: Landlords and creditors should not use these particular DWP email addresses for any other kind of correspondence.
Tell the DWP a ‘Breathing Space’ has Ended
The DWP does not restart debt deductions from benefit by automatic process even when the ‘Breathing Space’ has finished.
The main reason is because the debt position of the claimant can change. Thus, any deductions being taken for arrears may no longer be appropriate.
Use the following application forms to restart debt deductions from benefit when the ‘Breathing Space’ ends:
- DWP Debt Respite Scheme (‘Breathing Space’) creditor template [including ‘Breathing Space’ end date].
- Forms for new creditors to apply for deductions from a claimant’s ESA, JSA, Income Support, and Pension Credit.
You would need to fill in the creditor template (with the end date) if you no longer want the DWP to deduct the money from welfare benefit.