The moratorium provides six months of legal protection from creditor enforcement, including diligence and sequestration proceedings. This breathing space enables individuals to seek regulated advice, stabilise their financial situation, and explore realistic alternatives – most notably the DAS.

Paul McDougall, insolvency practitioner at Wbg, said: “The moratorium can be a lifeline for individuals under serious creditor pressure. However, it is essential that it is registered before the warrant to cite (WTC) is issued in sequestration proceedings.

“Once the WTC is granted, the debtor is immediately exposed to legal action, and the moratorium may no longer offer full protection.”

According to the Accountant in Bankruptcy (Aib), 947 applications for statutory moratoria were granted in Scotland from January to March 2025, representing a 2.4% decrease compared to the same quarter in the previous year McDougall says that if a WTC has already been issued, the court may still offer a temporary reprieve.

At first calling, the sheriff may grant a continuation of up to 42 days, but only in limited circumstances: where full repayment is realistically achievable, or where there is a genuine intention to apply for DAS.

The sheriff does not have discretion to extend the continuation beyond 42 days solely to allow time for payment in full. However, where the purpose is to submit a DAS application, Section 23(3) of the Bankruptcy (Scotland) Act 2016 grants the court discretion to allow additional time.

Paul McDougall added: “It is important to note that engaging a DAS-approved adviser and commencing the debt confirmation process constitutes the beginning of a DAS application, even if it has not yet been formally submitted.

“On this basis, legal representatives may argue for a continuation to allow the proposal to be finalised and lodged.”

A Debt Payment Programme (DPP) under DAS provides a structured and sustainable alternative to sequestration: full repayment over time, without loss of assets; freezing of interest and charges; protection of employment and company directorships; affordable monthly contributions based on real income and increased likelihood of higher creditor recoveries compared to sequestration.

“DAS offers a more balanced and commercially sensible approach,” adds Paul McDougall. “It protects the debtor from the stigma and impact of bankruptcy, while providing creditors with ongoing repayments.”

Wbg is fully authorised to assist individuals considering a moratorium and the DAS when facing a bankruptcy petition. It strongly encourages anyone at risk to seek advice as early as possible to maximise the protections available under the law.

Paul McDougall concluded: “Time is often the most critical factor. If clients or their solicitors contact us early, we can explore the best route forward and, where appropriate, move quickly to protect their position.”