For council tax the distinction is the whole answer. Council tax in Scotland is collected under a summary warrant, granted without a hearing, so there is no court action for you to respond to.

That closes the direction and leaves the order open, and the order is the one with the mandatory recall in it. What a time to pay order is covers the section 5 route on its own.

An instalment arrangement built into a decree before it is granted. You apply for it under section 1 of the Debtors (Scotland) Act 1987 as part of your response to a court action.

How it works

Section 1 of the Debtors (Scotland) Act 1987 lets the court, when granting decree in an action for payment of a debt, grant it subject to a direction that the sum is paid by instalments or after a deferred period.

So the direction travels with the decree. While you keep to its terms the creditor cannot move straight to diligence.

Where a direction fits

• A creditor has raised an ordinary court action against you.
• Decree has not yet been granted.
• You want to propose instalments the court can build into the decree.
• You respond inside the period stated on the papers, which is why court papers should never be ignored.

The ceiling on a direction

Section 1(5)(a) sets a ceiling of £25,000. The figure printed on the face of the section is £10,000, and it was substituted by regulation 2 of the Debtors (Scotland) Act 1987 (Amendment) Regulations 2000, in force on 10 July 2000.

The same instrument made the same substitution for the order. Any page still printing £10,000 for either route is twenty-six years out of date.

The same idea applied later. Section 5 of the Act lets the sheriff order payment by instalments or after a deferred period on a debt due under a decree or other document, once enforcement has started.

The three triggers

Section 5(1) applies to a debt due under a decree or other document in respect of which a charge for payment has been served, an arrestment has been executed, or an action of adjudication for debt has been commenced.

One of those three has to have happened. An order is a response to enforcement rather than a response to a claim.

The point that decides the council tax question

Section 15(3) defines a decree or other document, and it does so expressly for sections 5 to 14. Limb (aa) of that definition is a summary warrant.

Section 1 sits outside that range, which is why the definition reaches the order and not the direction. That is a structural point rather than a policy one.

On eight things that matter, and the summary warrant row is the one most Scottish readers need. Everything else follows from when in the process you are applying.

Direction against order

Neither route is a way of avoiding the debt. Both are ways of asking the court to fix instalments instead of enforcement, and which debt solution is best if you have a wage arrestment compares them with the statutory schemes.

The one line that covers most of it

A direction is applied for during a court action and an order is applied for after one. Only the order reaches a summary warrant.

The practical consequence for a council tax debtor is that the door most advice pages describe was never open, and the one that is open has a mandatory recall attached to it. What the difference between a summary warrant and a decree is sets out why the two are treated differently.

The order, and only the order. A direction is made inside a court action and no court action exists, while a summary warrant is expressly one of the documents an order can be made against.

Why people assume neither route works

A summary warrant is granted by the sheriff on the council’s application, supported by a certificate, with no hearing and nobody to answer. Our guide to what a summary warrant is sets out how it is obtained.

A 10% statutory addition goes on the outstanding balance when the warrant is granted, under Schedule 8 to the Local Government Finance Act 1992, which is another reason it does not feel like a court process.

What changed in 2008, and why older guidance is wrong

Two things happened on 1 April 2008. Section 15(3)(aa) was inserted by the Bankruptcy and Diligence etc. (Scotland) Act 2007, putting a summary warrant inside the definition.

On the same date, section 5(4)(c) and (e) were repealed. Those were the paragraphs that had barred a time to pay order on summary warrant debt.

So guidance written before 2008 was right at the time and is wrong now. Council tax is also not on the excluded list in section 5(4), which covers HMRC and Revenue Scotland debts.

None of that makes an application automatic, and none of it makes it easy. It makes it competent, which is the thing that used to be missing.

It is recalled, and the sheriff has no choice about it. Section 9(2)(a) says that where the sheriff makes a time to pay order, the sheriff shall make an order recalling any existing earnings arrestment.

Mandatory for wages, discretionary for everything else

That asymmetry is the strongest feature of section 9 and it is worth understanding precisely.

Four things it does not mean

• It does not mean the sheriff has to grant the order. Granting is the discretionary step, and the recall follows once it is made.
• It does not usually mean money already deducted comes back. Sums taken before that point are normally credited against the debt, so check the figures with the creditor.
• It does not cancel the debt. You still pay it, on the instalments the order sets.
• It does not remove the 10% addition or the fees already on the account.

Anyone promising an application will definitely succeed is guessing. What happens to money already taken when a wage arrestment stops covers the deductions already made.

A £25,000 ceiling excluding interest, a reasonableness test, one route per debt, an exclusion for HMRC and Revenue Scotland, and a point beyond which advanced diligence closes it off.

The restrictions, with their provisions

The point that is genuinely unsettled

Section 5(1) lists a charge served, an arrestment executed, or an action of adjudication commenced. Whether an earnings arrestment on its own satisfies the arrestment limb has not been resolved.

No web page should tell you the answer either way. Ask the sheriff clerk through the Scottish Courts and Tribunals Service or a money adviser what applies on your own account.

Through the sheriff court, and you do not need a solicitor. The sheriff clerk will tell you which form applies, and free money advice services help people prepare these applications as routine work.

Four things to settle before you lodge anything

• Check the outstanding figure against the £25,000 ceiling, excluding interest.
• Work the instalment figure out from a full budget rather than from optimism.
• Ask what stage the diligence has reached, because section 5(5) can close the route.
• Ask whether a statutory scheme would suit you better than a court application.

The reasonableness test in section 5(2) is where an evidenced budget earns its keep, and how to build a budget when money is taken from your wages sets one out.

The alternatives that do not depend on a sheriff

An approved Debt Payment Programme under the Debt Arrangement Scheme stops an existing earnings arrestment and freezes interest, fees and charges, and what the Debt Arrangement Scheme is explains how it works.

And the one that buys time rather than solving it

A statutory moratorium gives six months of protection and you get one per rolling 12 months, as how a statutory moratorium protects you explains. It stops service of a charge for payment, stops new diligence and stops creditor petitions for sequestration.

It does not stop an earnings arrestment that was already running. Section 197(5)(d) of the Bankruptcy (Scotland) Act 2016 lets a creditor carry on executing an earnings arrestment, a current maintenance arrestment or a conjoined arrestment order that came into effect before the moratorium began.

So on a deduction already running, the order is the route with the recall in it. Our council tax debt advice page sets out how we help.