Breathing Space- A new debt support scheme

From Tuesday 4th May 2021, the new Breathing Space and Mental Health Crisis Debt Respite Schemes will come into effect in England and Wales.

Breathing Space is a new scheme that gives people temporary protection from most types of debt collection while they take action to get on top of their debts. The Treasury has estimated that up to 700,000 people could be helped by the scheme in its first year.

You can apply through a debt adviser for sixty days’ Breathing Space. During this time you must continue to engage with your debt adviser and not take out any new borrowing over £500. There are certain types of payments you will have to make, including ongoing housing costs, utility bills, and taxes. The benefit of the scheme is that interest and fees will be paused on debts included in Breathing Space while these conditions are met. You can only apply for Breathing Space once in a 12-month period.

If you’re being treated for a mental health crisis, a separate scheme applies. An approved mental health professional will need to confirm you are receiving crisis care. Your GP can’t make this confirmation, but should be able to refer you to someone who can. You can then seek help from the scheme yourself, or someone else - for example a carer, social worker or mental health nurse - could apply on your behalf.

Visit the Citizens Advice and GOV.UK websites for full details of the scheme.