A Protected Trust Deed, or PTD, is Scotland's formal alternative to an IVA. You make affordable monthly payments, usually for four years, and any remaining qualifying debt is written off at the end. It is available only to people who live in Scotland.
A trust deed is a legally binding agreement between you and your creditors, set up by a licensed Insolvency Practitioner who acts as your trustee. It is governed by the Bankruptcy (Scotland) Act 2016 and overseen by the Accountant in Bankruptcy, the Scottish public body responsible for personal insolvency.
It becomes ‘protected’ once creditors have had the chance to object and not enough of them do. Protection makes the arrangement binding on all your creditors, so they cannot pursue you for the included debts, add interest, or take court action while you keep to the terms.
After you sign, your trustee writes to your creditors to tell them the trust deed is to become protected. To stop that happening, objections must come either from a majority of your creditors in number, or from creditors owed more than a third of the total debt by value. Creditors who do not reply within five weeks are treated as agreeing.
If too few object, the trust deed becomes protected and binding on everyone. From that point your creditors cannot add interest or charges, contact you for payment, or take court action over the included debts, as long as you keep to the agreement.
| Feature | Protected Trust Deed | IVA |
|---|---|---|
| Where | Scotland | England, Wales & N. Ireland |
| Governing law | Bankruptcy (Scotland) Act 2016 | Insolvency Act 1986 |
| Usual length | Around 4 years | Usually 5 to 6 years |
| How it is approved | Becomes protected unless enough creditors object | Creditor vote, 75% by value must agree |
| Debt written off | Remaining qualifying debt at the end | Remaining qualifying debt at the end |
| Overseen by | Accountant in Bankruptcy | The Insolvency Service |
If you live in Scotland you use a trust deed, not an IVA; the two are not interchangeable. Scotland also has the Debt Arrangement Scheme, for repaying debt in full over time with interest frozen, and sequestration, the Scottish form of bankruptcy.
A trust deed is a form of insolvency. Fees apply, your credit rating is affected for six years, and it is recorded on a public register. It is not suitable for everyone, so it is worth getting free, impartial advice before you commit.
A trust deed is one of several Scottish options. You can check which might fit your situation, with no obligation.
You never have to pay anyone to understand your options. These services are free, independent and will go through every route with you.