Terrence Higgins Trust uses cookies to improve your experience of our websites. For more information or to change the use of cookies, please click here.

Accept and Close



If you’re experiencing a problem with debt it’s important not to ignore the situation, but to get advice as soon as possible.

By acting early on you can avoid some of the added stress and expense of court charges, bailiff fees and penalties, as well as unnecessary damage to your credit status.

If you have a problem with debt, you will need to:

  • work out how much money you owe
  • work out which are the priority debts
  • work out whether you've got any money to pay your debts
  • deal with the priority debts urgently
  • look at your options for dealing with the less urgent, non-priority debts and work out how to pay them off
  • contact your creditors and make arrangements to pay back what you owe
  • work out your options if you don't have enough money to pay off all your debts.

Working out your debt liability

In working out how much money you owe, you or a debt adviser may want to work out whether you’re liable or not for all of your debts.

You can be liable because:

  • of a statutory duty eg, for Council Tax
  • you’ve signed a contract eg, a credit card agreement or because you have signed as a guarantor for someone else
  • you have used a service which implies a contract, such as utilities or ordering from a catalogue
  • of a court order eg, to pay a fine, compensation or damages.

You can be jointly and severally liable with someone else if both or all have signed the agreement. For for some debts, such as Council Tax and water charges, you ca be liable if you’re part of a married couple, a civil partnership or living together as husband and wife or as civil partners.

You may not be liable for a debt if you are a minor - if you are under 18 in England and Wales or under 16 in Scotland.

You may also be able to challenge liability for a debt if you think that the amount is wrong, if you are in dispute (for example buying faulty goods or services) or if the debt is unenforceable.

Debts that won't be enforced

There are a few circumstances in which you may not have to repay a debt.

A debt becomes unenforceable if:

  • the creditor did not meet the requirements of the Consumer Credit Act 1974
  • the creditor has not taken court action within the time limit
  • it can be shown that you did not have the capacity to enter into an agreement
  • it can be shown that you were unduly influenced to enter into the agreement.

A debt adviser can help you to establish whether or not your debts are enforceable.

What is the difference between priority and non-priority debts?

A priority debt is one that could result in:

  • you losing your home
  • losing your liberty
  • losing access to essential supplies such as gas and electricity
  • in some cases, losing access to essential goods

You should always deal with these debts first before trying to repay your non-priority debts.

Examples of priority debts which can result in you losing your home are mortgage or secured loan arrears and rent arrears.

Priority debts which can result in you losing your liberty and facing a prison sentence include:

  • Council Tax arrears
  • maintenance
  • child support arrears
  • Income Tax
  • VAT arrears

Non-priority debts are those which have a less serious effect if not paid. The creditor can generally sue the lender for money or repossess goods.

However, if the creditor has a court judgement against you which you fail to meet, they may be able to take enforcement action against you or make you bankrupt. This could have more serious consequences, such as losing your home if you are a homeowner.


Once you’ve worked out how much you owe and which are priority and non-priority debts, you will need to work out your budget. This involves making a list of your income and expenditure. You would only include essential expenses in this list. You can use the Citizens Advice Bureau online budgeting tool to help you with this.

Once you have calculated your total income and expenditure, you should be able to see whether there is anything left over to pay towards your debts. If there is, you would need to:

  • deal with the most urgent debts as a matter of priority
  • look at your options for dealing with the less urgent debts
  • contact your creditors and make arrangements to pay back what you owe.

If you don’t have any spare money left over to pay towards your debts, you’ll have few options and may need to seek advice on maximising your income and reducing your spending. A debt adviser will also be able to explain other options such as debt relief orders, administration orders, individual voluntary arrangements and bankruptcy.

You can get help with debt from several sources including Terrence Higgins Trust’s online advice service, your local Citizens Advice Bureau and the My Money Steps website, which is run by the National Debtline service.



Empty Star Empty Star Empty Star Empty Star Empty Star (No votes cast) Please log in or register to vote. What's this?


Please log in or register to add this article to My favourites. What's this? Adding an article to My favourites will allow you to easily come back to it later or print it.

Your comments

You will need to be logged in before you can leave a comment.

Please log in using the form on the top right of the page or register.

The Information Standard: Certified member

This article was last reviewed on 24/9/2014 by C. Berry

Date due for the next review: 24/9/2017

Content Author: G. Arrindell

Current Owner: D. Anyanwu

More information:

Citizen's Advice, Advisernet - Dealing with people you owe