What is Breathing Space and how can it help me?

Breathing Space is a new debt option that gives you temporary protection from the creditors you owe money to if you’re struggling with debts. This includes:

• freezing most interest, fees and charges on debts; and 
• pausing most enforcement action and contact from creditors.

It’s a short-term option, to give you time and space to engage with debt advice and find a longer-term solution.

There are two types of Breathing Space:

• Standard Breathing Space – which you apply for through debt advice, and which lasts for up to 60 days, with a review between days 25 and 35.
• Mental Health Crisis Breathing Space – which is specifically for people in mental health crisis treatment and can only be applied for with an Approved Mental Health Professional (AMPH). It lasts for the duration of your treatment, plus 30 days.

You might be eligible for Breathing Space if you:

• live in England or Wales 
• have a qualifying debt 
• don't have a debt relief order (DRO), individual voluntary arrangement (IVA), interim order, or are not an undischarged bankrupt at the time you apply
• haven't already taken Standard Breathing Space in the last 12 months.

If you live in Scotland, there is a similar scheme called a Statutory Moratorium. There’s no equivalent scheme.

If you live in Northern Ireland, there's no equivalent scheme.

To qualify for Mental Health Crisis Breathing Space you must be receiving specific treatment.

You are only eligible if any of the following applies:

• You've been detained under the Mental Health Act (also known as being sectioned)

• You've been removed to a space of safety under the Mental Health Act 

• You’re receiving crisis, emergency or acute care from a specialist service for a mental disorder of a serious nature. This might be from a crisis home treatment team, liaison mental health team, community mental health team or any other specialist mental health crisis service.

An Approved Mental Health Professional (AMHP) will need to use their professional judgement to decide whether your treatment constitutes crisis treatment for a mental disorder of a serious nature. The guidance for AMHPs explains what constitutes a mental health disorder of a serious nature within the Breathing Space rules.

Most personal debts will qualify for Breathing Space including:

• credit and store cards
  
• personal loans
• payday loans
• overdrafts
• arrears on mortgages, utility bills, hire purchase agreements and other secured debts
• most government debts, including tax and benefit debts
• Council Tax arrears.

Joint debts, like a joint mortgage, qualify, even if only one of you wants Breathing Space. However, where possible you should talk to the person you hold a joint debt with to make them aware that you are applying for Breathing Space.

Guarantor loans qualify, but the Breathing Space does not cover the person guaranteeing the loan.

Some debts will not qualify for Breathing Space, including:

• debts run up because of fraud
• court fines
• child maintenance payments
• crisis or budgeting loans from the social fund
• Universal Credit advance payments
• student loans
• damages for the death or personal injuries caused to someone else
• obligations from a confiscation order.

You can only apply for Breathing Space though a debt adviser. 

If someone approaches you directly about Breathing Space or offers to arrange it for you for a fee, it's likely to be a scam.

You cannot apply for Mental Health Crisis Breathing Space by yourself. You can only apply with the support of an Approved Mental Health Professional (AMHP).

An AMHP means someone approved under section 114(1) of the Mental Health Act 1983 by any local social services authority in England, or approved under that subsection by any local social services authority in Wales.

If you want to find an AMHP, you should speak to:

• the healthcare professional most involved in your care

• the AMHP team at your local adult social services department

• your local community mental health team.

The AMHP will complete an evidence form to show you’re receiving mental health crisis treatment. This can then be submitted to a debt adviser by the AMHP, yourself, or by another person, such as a carer, social worker or a nominated representative. 

Evidence forms should be submitted through the single point of entry provided by the Money and Pensions Service.

Breathing Space is designed to give you time to get debt advice and look at any possible debt solutions.

This means you must keep talking to a debt adviser throughout Breathing Space to continue to receive its protections.

The adviser must conduct a mid-way review with you between days 25 and 35 to confirm that you are engaging with advice and meeting the conditions of Breathing Space, which are:

• informing your debt adviser if there’s been any change in your circumstances
• not taking out extra individual or joint borrowing exceeding £500, including overdrafts
• continuing to pay your essential bills and any debts not covered by Breathing Space.

If you’re in any doubt about what you need to do during Breathing Space, you should talk to your debt adviser.

Mental Health Crisis Breathing Space is designed to give you time to receive treatment without being pursued for your debts.

You do not need to meet the same conditions as Standard Breathing Space, but a Nominated Point of Contact (to be included within the evidence form) will need to confirm you’re still in mental health treatment every 30 days. 

You should also continue to pay bills and make your regular debt repayments if you can, as Breathing Space is not a payment holiday, and you may still be contacted about these.

At the end of Breathing Space, the protections will end and the creditors you owe money to can:

• start adding interest, fees and penalties to your debts
• take action to enforce the debt
• resume or start legal proceedings.

This is why it’s very important that within Standard Breathing Space you actively engage with a debt adviser to find a longer-term debt solution that works for you that could avoid these things happening. 

If you’re applying for Standard Breathing Space, the debt adviser dealing with your application will look at all the options available to you and might recommend something other than Breathing Space. They will talk through the pros and cons of other options available to you.