Administration orders

An administration order is a court-run repayment plan for people with small debts who have already been taken to court. It is legally binding on the people you owe and gives you protection from them: while the order is in place, none of the creditors listed on it can take any action against you without first getting the court's permission¹. You make one affordable payment to the county court each month, and the court passes the money on to your creditors².

To qualify, your total debts must be no more than £5,000 and you must have at least one county court judgment (CCJ) against you, plus at least one other debt³. There is no upfront fee to apply, but the court keeps 10p out of every £1 you pay in to cover its administration costs⁴.

The order is aimed at people with modest debts who can afford something each month but who need the court's protection to stop enforcement action. Administration orders are rarely used nowadays, and most people find a debt relief order is a cheaper and more suitable debt solution², but for those with a judgment and debts under £5,000 the administration order remains a real option, and one of the few that costs nothing to set up.

How an administration order protects you

An administration order is a court ordered repayment plan or instalment order, which stops further action by creditors while you make the required payments to the court¹. It is legally binding on the people you owe and gives you protection from them². The protection works in three ways.

First, none of the creditors listed on the order can take any action against you without first getting the court's permission¹. That means no bailiffs, no attachment of earnings order, no charging order and no further court claims from those creditors while the order runs. Second, the creditors included in the order cannot contact you for payment, and they cannot add any more interest or charges to your debts². Any interest and other charges that were being added to the debts are stopped¹. Third, while you are making your payments each month, the creditors must accept the payment they are getting through the court⁷.

The order is described by debt charities as a legally binding administrative arrangement, issued by a County Court, that enables you to pay only what you can afford each month towards your credit debts, after your essential expenditure such as priority debts and general living costs have been accounted for⁸. In other words, the court looks at what is left after your essential bills and living costs, and sets your payment at a level you can sustain.

The protection is not unconditional. It lasts only while the order is in place and you keep up the payments, and it covers only the creditors listed on the order. A creditor can object to being in the order and ask the court to leave them out², and a judge may exclude certain debts, as covered below. If the order is revoked, the protection ends and your creditors can pursue you again in full¹.

Who can get one: debts up to £5,000 and a court judgment

The rules for qualifying are strict, and all of them must be met. An Administration Order can help you deal with your debts if they are £5,000 or less and you can afford to make regular payments to your creditors⁵. You must have at least two debts⁹, and the trigger for the whole arrangement is a court judgment: if you receive a county court judgment and have at least one other debt, and your total debts are worth no more than £5,000, you can ask the court to deal with your debts through an administration order⁶. If you have a CCJ and your debts are under £5,000 in total, you could ask the court to deal with your debts this way¹⁰.

The £5,000 figure is the total of everything you owe, not the judgment debt alone. If you owe less than £5,000 in total to all your creditors, you can argue that a debt should be included in an administration order, for example when a creditor is seeking a charging order against you¹¹. The limit also matters because it sits just below another threshold in the insolvency rules: a creditor owed £5,000 or more can apply to the court to have an individual declared bankrupt¹². People with debts under £5,000 are, in that sense, below the level at which a creditor can force bankruptcy.

Two practical points about eligibility come up again and again in the guidance. The court does not usually accept joint applications¹, so a couple with shared money problems generally needs to look at separate solutions, and joint debts count towards each person's total. And some courts may turn you down automatically if you are getting a benefit from the Department for Work and Pensions (DWP). They should not do this¹. Receiving benefits does not disqualify you; the test is whether you can afford regular payments, and many people on benefits do have a small monthly surplus.

The administration order itself is an England and Wales solution⁴. Northern Ireland has its own version, applied for differently, which is covered under how to apply below.

Which debts can and cannot be included

In theory, all of your debts can be included in the order². This is one of the features that distinguishes the administration order from most other debt solutions, which exclude whole categories of debt. In practice, the district judge who considers your application decides what goes in.

Two categories deserve special mention. Council tax arrears for previous years can be included on the administration order on the basis of the case Preston BC v Riley, decided in 1995, and following that case the court can also allow poll tax arrears to be included¹. Any magistrates' court fines can be listed in your application for an administration order¹. However, sometimes a judge may leave out some debts, and the examples given in the guidance are council tax arrears and criminal fines². So while these debts can go in, there is no guarantee they will.

It is worth comparing this with the exclusions in other solutions, because it explains why the administration order survives for certain people. A debt relief order cannot include magistrates' court fines, maintenance and Child Support Agency or Child Maintenance Service payments and arrears, student loans, budgeting loans and crisis loans, criminal confiscation orders, or certain personal injury claim debts¹³. Court fines, child maintenance and student loans will not be allowed in a DRO¹⁴. Bankruptcy likewise leaves mortgage or rent arrears, maintenance and child support payments, student loans, court fines and court ordered payments outside the order¹⁵. The draft regulations for the planned statutory debt repayment scheme list similar mandatory non-eligible debts, including secured debt, fraud-incurred debt, court fines, student loans, child support and confiscation orders¹⁶.

For the administration order, the position is more generous on paper: everything can be listed, and the judge decides. If a debt is left out, that creditor is outside the order's protection and you will need to deal with them separately. Free debt advice, available from charities such as those listed in our guide to free debt advice, can help you work out which of your debts are likely to be accepted before you apply.

Costs: no upfront fee, but the court keeps 10%

An administration order is one of the cheapest debt solutions to set up. There are no fees to apply for an administration order¹⁷, and you do not have to pay any court fees up front¹. There are no upfront fees to pay for an AO⁷.

The court's cost comes out of your payments instead. The court will take a handling fee of ten pence out of every pound you pay in during the time the order lasts¹. Put another way, there is no court fee to set up an administration order, but the court keeps 10% of each payment².

There is a cap on the total the court can take. The total amount taken in fees cannot be more than 10% of your debt¹⁷. So if the order runs for years, the fee eventually reaches that ceiling and stops.

There is no fee to pay for making an application to change your payments, as this is already included in the arrangement¹. That matters if your income falls part way through the order: asking the court to reduce your monthly payment costs nothing extra.

The only other cost to know about comes at the end. When the order finishes, you can ask the court for a certificate of satisfaction, an official record showing that the order has finished, and you have to pay a fee of £19 for this¹. This is covered in more detail under completing the order below. For comparison with what other solutions charge, see our guide to what debt solutions cost.

How to apply

You apply through your local county court, and there are certain costs and conditions you must meet⁵. The process in England and Wales runs as follows.

1. Work out your budget first. Your payment will be based on what you have left after paying essential bills and living costs², so you need this figure before you can propose a monthly amount. Our guide to budgeting for repayments explains the standard tools advisers use.
2. List all your debts. Check that the total is £5,000 or less, that you have at least one county court judgment, and that you have at least two debts⁵.
3. Fill in form N92. To apply for an AO, you have to fill in an application form called an N92 and send it to the court. You can pick the form up from your local county court or download it from the Gov.UK website⁷.
4. Send it to your local county court with your budget and your list of debts⁵.
5. Wait for the court's decision. A district judge considers the application. A creditor can object to being in the order and ask the court to leave them out², and the judge may also decide to make a composition order if your payments would not clear the debts in a reasonable time.

In Northern Ireland the route is different. You contact the Enforcement of Judgments Office (EJO) for a copy of Form 11, fill in this form and return it to the EJO². The Northern Ireland scheme also differs in one useful respect: you can apply for a composition order at the same time as your administration order, rather than waiting for the court to raise it later².

Before applying, it is worth getting advice from a free debt charity. An adviser can check whether an administration order is the right fit or whether a debt relief order or an informal payment arrangement would serve you better, and can help you complete the budget that the whole application rests on.

Paying the court each month

Once the order is made, you make a single payment every month into the court¹. You make one payment to the court each month, and the court then passes the money to your creditors². You do not deal with the creditors individually any more: the court handles the distribution, and while you are making payments each month under the AO the creditors must accept the payment they are getting through the court⁷.

The amount is set by the court based on your budget. This payment is based on what you have left after paying essential bills and living costs². If your circumstances are stable, the payment stays the same; if they change, you can ask the court to alter it, as covered under changing the order below.

One point to be aware of: the court may want to take your payments directly from your wages². This is similar to an attachment of earnings order, which is one of the ways a creditor can enforce a CCJ¹⁸. If the court proposes this, it is not a penalty, but it does mean your employer would know about the order.

If you miss payments, the position is serious. The court can revoke the order, and if your administration order is revoked, your creditors can pursue you again for each debt you owe in full, even if you had a composition order made¹. All the protection described earlier stops: enforcement such as bailiffs, an attachment of earnings order, a third party debt order or a charging order becomes possible again, and these are exactly the actions a creditor with a judgment can take¹⁸. If you cannot keep up the payments, the advice is not to drift: write to the court and ask to alter the payment or cancel the administration order², and get free debt advice about your next step.

Composition orders: repaying only part of the debt

A composition order is a variation to an administration order¹⁹. If the district judge makes a composition order, it means that you only have to pay part of your debts¹. It is the mechanism by which an administration order, which normally runs until everything is paid, can instead end with a portion of the debt written off.

The court only considers a composition order if your payment will not clear the debts in a reasonable amount of time². A composition order will usually be considered by the judge overseeing your administration order application if your proposed payments are so small that it will take many years to pay back your debt in full¹⁹. The specific trigger in the guidance is time: if it looks as though it will take more than three years to clear the debts under the AO, the court can make a composition order, usually limiting repayment to three years⁷. You can ask for a composition order, which means the debts may be written off after a shorter time such as two or three years⁹.

The effect is straightforward. The court sets an end date, usually three years out. You keep making your single monthly payment to the court, which keeps its 10p in every £1 for administration costs⁷. Creditors write off any remaining debt when you reach this date². In other words, you will only end up paying back a proportion of the debt that you owe¹⁹.

Two records matter at the end. If you only repay a percentage of your debts back through this order, you can get an official record showing that the order has finished, by asking the court: a certificate of satisfaction, for which you have to pay a fee of £19²⁰. This is worth having, because it is your proof that the creditors can no longer chase you. In Northern Ireland, you can apply for a composition order at the same time as your administration order², rather than the court raising it later.

The main risk with a composition order is revocation. If the order is revoked before the end date, the write-off never happens: your creditors can pursue you again for each debt you owe in full, even if you had a composition order made¹. So the three-year limit is earned by keeping up the payments, not granted at the outset.

Effect on your credit file and the public register

An administration order appears for six years on your credit file and on the public Register of Judgments². Details of your administration order will be recorded on credit reference files for a period of six years from the date of the administration order⁴. During this time it is harder to take out credit².

Some context softens this. Your credit rating would have already been affected by having a CCJ against you⁷, which is a condition of getting the order in the first place. A county court judgment goes on your credit file for six years from the date it was issued¹⁸, and it will count against you if you apply for credit in the future²¹. CCJs also show on the Register of Judgments, Orders and Fines, and anyone can check if you have an outstanding CCJ for a fee of £4²². Lenders will be able to see that you have a CCJ²².

The six-year rules run on their own clock. A CCJ is removed from the public register and your credit file after six years, even if you have not paid it off²², and the same six-year period applies to the administration order record from its own date⁴. You cannot remove a CCJ from the register early once more than a month has passed since judgment, though if you pay off the full CCJ amount within a month of judgment you can apply to have it removed²². Paying a CCJ in full later gets it marked as satisfied, which makes it easier to apply for credit in the six years before it drops off your credit file²².

The practical reading is this: by the time you qualify for an administration order, the credit damage of the judgment is already done. The order adds a six-year record from its own start date, but it also gives you a structured route to clearing or partly clearing the debts, which is itself what most lenders want to see. For how court judgments arise and what to do at each stage, see county court judgments.

Changing, cancelling or completing the order

Circumstances change, and the order is designed to be flexible. If your income falls or your essential costs rise, write to the court and ask to alter the payment or cancel the administration order². There is no fee for making an application to change your payments, as this is already included in the arrangement¹. The court can reduce the payment, and if a reduced payment means the debts will no longer clear in a reasonable time, the judge may consider a composition order at that point¹⁹.

An administration order will continue until all the debts are paid off in full¹. Your administration order ends when your debts are paid in full, unless there is a composition order, in which case it ends at the composition date². When it finishes, the protection is permanent: none of your creditors listed on the administration order can take further action against you if your administration order has finished¹.

At that point, ask the court for a certificate of satisfaction. This is an official record showing that the order has finished, and the fee is £19¹. It is particularly important if you repaid only a proportion of your debts through a composition order²⁰, because it is your documentary proof that the remaining debt was written off and cannot be chased.

The outcome to avoid is revocation. If the court revokes the order, typically because payments have been missed, your creditors can pursue you again for each debt you owe in full, even if you had a composition order made¹. Everything returns to where it was before the order, except that the creditors now know the arrangement failed. If you are struggling, the alternative to drifting into revocation is to write to the court and ask for the payment to be altered before matters reach that point², and to get free help from a debt charity in good time.

Debt relief orders and other alternatives

Administration orders are rarely used nowadays, and most people find a debt relief order is a cheaper and more suitable debt solution². It is worth understanding the alternatives before committing either way, and a free debt adviser can compare them against your exact circumstances. Our guide to debt solutions across the UK sets them all out side by side.

Debt relief orders (DROs) are for people who are not homeowners, are on a low income, have few assets and have debts of less than £50,000¹³. A DRO lasts for 12 months²³, after which the qualifying debts are written off, which is a much shorter commitment than an administration order that runs until the debts are cleared. The trade-off is the exclusion list: court fines, child maintenance and student loans will not be allowed¹⁴, and magistrates' court fines, maintenance and CSA or CMS payments and arrears, student loans, budgeting loans and crisis loans, criminal confiscation orders and certain personal injury claim debts cannot be included¹³. An administration order can, in theory at least, take those debts on². You cannot get a DRO if you are a homeowner²⁴.

Informal options cost nothing and suit smaller debts: a debt management plan or a direct payment arrangement with your creditors, though not all debts can be included in management solutions²⁵ and informal arrangements lack the court's protection. A breathing space order gives protection from creditor action while you get advice.

Bankruptcy writes off most debts but is a bigger step, and it becomes a risk rather than a choice at the £5,000 mark: a creditor owed £5,000 or more can apply to the court to have the individual declared bankrupt¹². Mortgage or rent arrears, maintenance and child support, student loans, court fines and court ordered payments are not caught by a bankruptcy order and must continue to be paid¹⁵.

Scotland has no administration order. In Scotland, solutions include an informal agreement, the Debt Arrangement Scheme, a protected trust deed or bankruptcy²⁶. Council tax arrears in Scotland are enforced through different routes, including asking a sheriff officer to make a payment agreement with you²⁷, and deductions from benefits are handled through a separate DWP order with its own appeal route²⁸. Our guides to diligence in Scotland and to sequestration cover these.

Northern Ireland has its own administration order scheme through the Enforcement of Judgments Office², and debt relief orders are also available there²³. There is different official guidance on insolvency for Northern Ireland and for Scotland²⁹, and the Insolvency Service provides help with insolvency across England and Wales²⁹.

Whichever route fits, the starting point is the same: a full budget, a complete list of debts, and free advice before you commit. The charities and services in our guide to free debt advice will not charge you, and DWP benefit statistics, which are accredited official statistics³⁰, show how many households rely on benefits as their income base, so a benefit income is no bar to getting help.