What is the Business Debt Arrangement Scheme?

The Debt Arrangement Scheme (DAS) has now been extended to small and medium sized businesses in Scotland so that they can continue to trade whilst dealing with their debts, avoiding unnecessary business insolvency.

The Business DAS is a statutory debt management tool launched by the Scottish Government in December 2014. It was introduced to help people (partnerships, trusts or an unincorporated body of persons) in debt repay their creditors. The Debt Payment Plan (DPP) allows debtors to pay off their debts over an extended period of time while giving them protection from their creditors taking action against them to recover the debt in the DPP. The DPP under business DAS can only last for a maximum of 5 years. If approved, will freeze all interest, fees, penalties or other charges on the debt, resulting in them being repaid in full if the debtor fully completes the DPP.

Unlike the DAS, which requires the DPP to prepared and submitted by an approved money advisor, the DPP for a Business DAS must be prepared and signed off as being viable by a registered insolvency practitioner. The insolvency practitioner will also conduct an annual review to ensure the ongoing viability of the business.

When to consider the Business DAS Scheme

To be eligible for the Business DAS scheme, businesses must:

  • apply through an insolvency practitioner,
  • have their established place of business in Scotland,
  • be formed under Scots law, and
  • be carrying on business in Scotland.

Next steps

Prior to the launch of the Business DAS mlm Solutions, as a market leader, adapted the DAS to help small businesses, experiencing financial difficulty, to manage their debt and survive. This experience led to mlm Solutions to be invited to represent the Insolvency Practitioners Association in the Scottish Government’s Business DAS working group. With a qualified money advisor and an in-house team of highly experienced insolvency practitioners mlm Solutions is well placed to be appointed to, and advise on, Business DAS cases.

Our in-house approved money advisor will review your financial circumstances and prepare a budget with you showing what you can realistically afford to pay towards your debts on a weekly, or monthly, basis. Once your circumstances have been assessed, and your budget agreed, our money advisor will work with one of our in-house insolvency practitioners to prepare the DPP and submit it to your DAS to your creditors for approval.

Creditors will then have 21 days to formally object and if no objections are received it is submitted to the DAS Administrator (the Accountant in Bankruptcy) for approval. If any of your creditors do object, then the DAS Administrator has the authority to overturn this objection if they consider the proposal to be ‘fair and reasonable’ to all parties concerned.

For Scottish debt help, see also:-

You may also be interested in considering the following related pages if you live in Scotland:-

Business Debt Arrangement Scheme advice in Glasgow & Edinburgh, Scotland

We understand that facing up to financial challenges can be an extremely difficult and stressful time. However, you should be reassured to know that there are options available and, with the right advice and support, you can take the necessary steps to improve your situation.

For further Advice on Business Debt Arrangement Schemes, contact us today at an office near you.

 

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