A clear, comprehensive guide to Scotland's most popular formal debt solution.
A Protected Trust Deed (PTD) is a voluntary, legally-binding agreement between you and your creditors, available exclusively to residents of Scotland. It is governed by the Bankruptcy (Scotland) Act 1985 (as amended) and must be administered by a licensed Insolvency Practitioner (IP).
When a Trust Deed gains "protected" status, it becomes enforceable against all your unsecured creditors - even those who did not agree to it - providing you with powerful legal protection from debt recovery action.
Not all Trust Deeds automatically achieve protected status. Here is the process:
Key point: Once protected, even creditors who voted against it cannot pursue you for the debt or add further interest and charges.
Once your Trust Deed is protected, you make a single affordable monthly payment to your Trustee for the agreed term - typically 48 months. The Trustee distributes these payments among your creditors on a pro-rata basis.
During this period, creditors are legally prohibited from contacting you, taking court action, or charging additional interest or fees on the debts included in the Trust Deed.
After you have completed all your payments and addressed any equity in your home if applicable, your Trustee issues a certificate of discharge. This legally writes off all remaining qualifying unsecured debt included in the Trust Deed - regardless of how much remains unpaid.