FROM Tuesday May 4, the new breathing space and mental health crisis debt respite schemes will come into effect in England and Wales.

Breathing Space is a new scheme that gives people temporary protection from most types of debt collection while they take action to get on top of their debts.

You can apply through a debt adviser for sixty days’ breathing space.

You must continue to engage with your debt adviser and not take out any new borrowing over £500 in this time.

You’ll also have to continue to make certain types of payments, including ongoing housing costs, utility bills, and taxes.

Interest and fees will be paused on debts included in Breathing Space while these conditions are met.

You can only apply for Breathing Space once in a 12 month period.

The coronavirus pandemic has had a huge impact on lots of people’s finances, with millions falling behind on essential bills and getting into debt.

With temporary protections on debt coming to an end, we’re worried that the real struggle will soon begin for many.

If you have unmanageable debts, the new scheme could give you the time to get the advice that will help, and to start taking action.

Breathing space isn’t a temporary fix to simply keep your creditors at arm’s length.

You’ll need to work with your debt adviser to try and make a plan to deal with your debts.

For anyone who feels they can’t manage their debt, the most important thing is to seek help as soon as possible from a free and impartial debt advice charity like Citizens Advice.

Lorraine Charlton

Debt Expert at Citizens Advice