The split is not about the size of the debt. It is about what the creditor can do to you if the debt is not paid.

Fall behind on a catalogue account and you get a default. Fall behind on council tax in Scotland and the consequences arrive faster and reach further.

Debts due under credit agreements. Article 39E of the Regulated Activities Order defines debt counselling as advice about the liquidation of a debt due under a credit agreement, and article 39D defines debt adjusting in the same terms.

Why that shapes the list

The activities a provider is authorised for are defined by reference to credit agreements and consumer hire agreements. The Financial Conduct Authority’s own definition of a plan is an agreement between a customer and one or more of the customer’s lenders.

So the natural content of a plan is what you owe lenders. Everything else is a question of what a particular provider will handle.

The usual list

Article 39D covers debts due under a consumer hire agreement as well, so hire agreements are inside the regulated activity even though they are not credit.

Include everything eligible

No creditor has to accept a debt management plan, and nothing requires one to give a reason for refusing.

A creditor that thinks it is being treated less favourably than the others has an easy reason to refuse, and whether creditors have to accept a plan covers what happens then.

The priority debts, and secured lending. The consumer credit rules do not reach most of them, which is a large part of the reason.

The Scottish priority list

Those rules bind only firms the Financial Conduct Authority regulates. They do not reach your council for council tax, HMRC, or the Child Maintenance Service.

So the forbearance rule that binds a credit card lender does not bind your council. Whether a plan freezes interest sets out what that rule actually says.

Ongoing bills never go into a plan

Your rent, your mortgage instalment, this year’s council tax and your monthly utility bills carry on being paid as normal. Only arrears are ever in question.

That is why the budget has to allow for them in full before anything is offered to creditors. How a monthly payment is worked out covers the arithmetic.

And a plan does not hold any of it back

A plan does not stop enforcement. It has no statutory effect on diligence at all.

StepChange’s own client agreement says creditors may continue collection activity including taking legal action, and that the charity will try to but cannot prevent it.

Because a council does not need an ordinary court action. It applies for a summary warrant instead, which is the real reason council tax arrears do not belong in a plan.

What that changes

Once a warrant is granted, sheriff officers can move to diligence without a further court step. Our council tax debt advice page sets out what is then available and in what order.

A plan cannot stop any of it, because it has no statutory effect. Whether a plan stops a wage arrestment is the page that deals with the consequence most people are worried about.

Which is why generic UK guidance misleads here

There is no magistrates’ court in Scotland, and Scotland has council tax rather than domestic rates. A list that names either is describing a different jurisdiction.

The Scottish route for court fines is different again, and it is enforced under its own regime. National Debtline’s Scottish guide is the one written for this jurisdiction.

What to do about council tax arrears instead

A separate arrangement with the council, or a statutory route that can take council tax in. Whether council tax arrears can go in a plan goes through the options.

The Debt Arrangement Scheme can include council tax, which is one of the practical differences between the two routes.

Three different answers, depending on which route you are in. In the Debt Arrangement Scheme they are excluded by definition, so they cannot be included at all.

The three positions

The DAS exclusion was inserted by SSI 2015/216, in force 27 June 2015, and it takes four listed kinds of student loan out of the definition of debt entirely.

And a sequestration does not write one off

Student loans are not written off either, by a different route. Section 145(7) leaves the student loan regulations untouched rather than listing the debt as an exception.

A student loan is left out of the £25,000 test on the way in and is still owed on the way out.

Section 145 is where that sits, and it is a different route from the list of debts the section expressly excepts.

In a plan it is a question of practice

Nothing in the rules says a student loan may or may not be included, and income-contingent repayments are collected through the payroll rather than by a creditor chasing you.

So ask the provider, and get the answer in writing. The same applies to business debts if you are self-employed and to any debt somebody has guaranteed.

Mainly over priority arrears. Some providers will administer arrears on rent, a mortgage or utilities alongside the credit debts and others will not, so ask yours in writing which debts it has taken on.

Why there is no single answer

A debt management plan is an informal arrangement rather than a statutory scheme. No Act of Parliament creates it, nothing prescribes its form, and it binds nobody by force of law.

So there is nothing to prescribe the content of a plan. Each organisation structures its service differently and neither approach is wrong.

What you are entitled to know

CONC 8.3.1R requires the pre-contract information to reach you in a durable medium before you commit, and it runs to fourteen numbered limbs.

Ask which debts are in and which are out, and check the answer against your own list. How to set a plan up covers the rest of the paperwork.

If a creditor is left out

That creditor is free to carry on as before, and how a plan works sets out what a creditor keeps whether it is in the plan or not.

They sit outside a standard plan. A mortgage, a secured loan and hire purchase on goods you need all carry a consequence that a plan cannot hold back.

The security survives whatever you agree

Even in a sequestration, section 145 discharges the personal obligation and leaves a secured creditor’s rights over the property intact.

A plan does not touch security at all. Arrears on a secured debt are handled with the lender rather than inside the arrangement.

Hire purchase on essential goods

The consequence of not paying is repossession of the goods, which is why it is treated as a priority rather than as ordinary unsecured credit. A car you need for work is the usual case.

Ask the provider how it will treat the agreement before the first payment. How a plan works covers what happens when a creditor declines.

And your ongoing payments carry on

The instalment due this month is not arrears and never goes into a plan. Only what you have fallen behind on is ever in question.

Start with the whole list, then sort by what each creditor can do if the debt is not paid. Priorities are dealt with first and the surplus that remains is what a plan works with.

The order to do it in

National Debtline’s Scottish material screens for two things before a free plan is set up: whether you can pay at least £5 to each debt every month, and whether the debts can be repaid within ten years.

One Scottish caution about old debts

Under section 6 of the Prescription and Limitation (Scotland) Act 1973 an obligation can be extinguished after five years without a relevant claim or acknowledgment.

A payment is an acknowledgment. So if any debt on your list is old, take advice before paying anything towards it, because paying keeps it alive.

And check whether a plan is the right shape at all

Where most of what you owe is priority debt, a plan is dealing with the smaller half of the problem. The difference between a plan and the Debt Arrangement Scheme and a plan against sequestration both set out routes that reach further.

Free advice is available from Citizens Advice Scotland, StepChange, National Debtline and Advice Direct Scotland, and what a plan is is the place to start if you are still deciding.