We’ve been asked, “can I go to prison for debt?”
What really happens if you fall behind on your debts? Could you end up behind bars? A hundred years ago this was a grim reality for many people, but nowadays in the vast majority of cases, the answer is thankfully “no”…
First, a little bit of history…
In 19th century Britain, if you were unable to pay a debt you might’ve ended up in debtor’s prison – a closed workhouse. So the answer to ‘can I go to prison for debt’ was a resounding ‘yes’!
Penniless people were often sentenced to imprisonment and forced to either work off their debt through labour, or remain there until someone outside prison walls could pay off the balance.
Over time however, the laws surrounding debt have become much more humane. Now there are only certain cases where debts can lead to imprisonment.
Consumer debts and imprisonment
The types of debt that cannot lead to imprisonment are:
- Credit cards
- Unsecured loans
- Utility arrears
- Hire Purchase agreements
However, there are some very rare cases where imprisonment or arrest due to owing a consumer debt could be a threat. One such situation is when dealing with a ‘County Court judgement’ (or CCJ).
If a creditor gets a County Court judgment granted against you and you ignore the letters, they could request that a court bailiff visit your house. You could be fined or sent to prison for 14 days for ignoring the court’s orders. It’s quite rare, but it’s worth keeping in mind that some creditors have been known to threaten imprisonment.
If the debt’s not a ‘priority debt’ such as child support, criminal fines or benefit overpayments then this threat is very likely to be a means of intimidation, and nothing else.
If you receive such threats on a non-priority debt then you should consider making a complaint.
What kinds of debt can lead to longer term imprisonment?
Some debts are more important than others. As such, they’re called ‘priority debts’ because they have more serious consequences for non-payment such as imprisonment. These include:
- Council tax
- Income tax
- Criminal fines
- Mortgages or loan secured against your property
- TV licence
- Business rates
- Child maintenance (also known as child support)
However, imprisonment may very occasionally be the final resort if you’ve ignored the letters continually, or refused to pay or make a payment plan once court action is taken against you.
Worried about your finances?
If you’re trying to save money because you’re concerned about your finances it may be worth:
- Checking to see if you’re in the right council tax band
- Comparing prices on your utilities and seeing if you can reduce your future bills
- Calling a debt advice organisation to work through your budget and find out your next steps
If you’re in need of free, confidential and impartial debt advice, our online tool Debt Remedy can help you put together a personal recommendation for how to deal with your debts in around 20 minutes.
Also, check out our section on debt and benefits which has loads of ideas to help you get out of debt and get into riches!