How does a Protected Trust Deed work in Scotland?
A protected trust deed lasts normally 4 years. Here is what you pay, what happens to your home and credit file, and the risks — explained without the sales pitch.
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Checked against current Accountant in Bankruptcy guidance. Figures verified 2026-08-14. Primary source · every figure we use.
How it works
A monthly contribution based on affordability. Normally 4 years.
Who it is for
Scottish residents with unsecured debts and a monthly surplus. The Scottish equivalent of an IVA, but with its own rules and a shorter typical term.
What it costs
The trustee's fees and outlays come from your contributions.
What happens to your home
Equity in your home is normally taken into account and may need to be released.
What it does to your credit file
6 years from the date it is granted. Recorded on the public Register of Insolvencies, maintained by the Accountant in Bankruptcy.
Protection from creditors
Once protected, creditors bound by it cannot pursue the included debts.
The risks you need to weigh
- If it does not become protected, creditors can still act.
- It is a formal insolvency and a public record.
- Failure can lead to sequestration.
How it compares
| Trust Deed | IVA | DMP | DRO | |
|---|---|---|---|---|
| Formal insolvency | Yes | Yes | No | Yes |
| Where it applies | Scotland only | England, Wales and Northern Ireland | The whole of the UK | England and Wales (Northern Ireland has its own version with different thresholds) |
| Typical duration | Normally 4 years | 60 months, or 72 with home equity | Until the debt is repaid — no fixed end | 12 months |
| Monthly payments | Monthly, affordability-based | Monthly, affordability-based | Monthly, flexible, changeable | No payments at all |
| Your home | Equity usually assessed | Excluded; equity sets the term | Not affected | Not available to homeowners |
| Credit file impact | 6 years | 6 years from the start date | Defaults recorded, 6 years each | 6 years from the order date |
| Public register | Recorded on the public Register of Insolvencies, maintained by the Accountant in Bankruptcy. | Listed on the public Individual Insolvency Register, which anyone can search. Your address can be withheld only on evidenced safety grounds. | Nothing public. A DMP is a private arrangement. | Listed on the public Individual Insolvency Register. |
| Fees | Paid from contributions | Paid from your monthly payments | Free providers available | Free — no application fee |
| Creditor protection | Binding once protected | Legally binding on included creditors | None — entirely voluntary | Full protection, then write-off |
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Common questions
Is a Trust Deed the same as an IVA?
They do a similar job but they are different legal instruments under different law. A Trust Deed normally runs four years rather than five, becomes binding through a different mechanism — creditors object rather than vote in favour — and is recorded on Scotland's Register of Insolvencies rather than the Individual Insolvency Register. If you live in Scotland, an IVA is not available to you.
What if my Trust Deed does not become protected?
If enough creditors object within the objection period, the deed remains unprotected. Creditors who did not sign up are not bound and can still pursue you, including through sequestration. Your trustee should tell you promptly if this happens so you can consider the alternatives, which in Scotland usually means the Debt Arrangement Scheme or sequestration.
Protected Trust Deed vs DAS
The Scottish choice in one line: a PTD usually runs 48 months and writes off what remains; the Debt Arrangement Scheme repays in full with interest frozen by law and assets untouched. Homeowners and anyone whose arithmetic could reach full repayment look at DAS first; where repayment in sensible time is unrealistic, the Trust Deed’s write-off is the point. Accountant in Bankruptcy statistics show Trust Deeds remain one of Scotland’s most used solutions — around 1,300 protected in the first quarter of 2026-27 alone.
Protected Trust Deed vs sequestration
Sequestration is the deeper cut: faster discharge, stronger asset consequences, the route where even Trust Deed contributions are unaffordable. A trustee will assess honestly which side of that line your circumstances sit — and the Minimal Asset Process exists precisely for low-income, low-asset cases where a Trust Deed would waste money.
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