Attachment of Earnings Order: How Wage Deductions for Debt Work

What is an attachment of earnings order?

An AEO is a way for a creditor to enforce a judgment. Instead of asking you to pay, the court orders your employer to deduct a set amount from each payday and pay it over. The law is the Attachment of Earnings Act 1971, and creditors apply using form N337.

It is one of several enforcement routes, alongside bailiffs and charging ordersCharging Order on Your Home: Interim Orders, Objections and SaleReceived an interim charging order? Understand the 28-day deadline, how to object and whether a creditor can force the sale of your home.Read more →. A creditor chooses the route, and a judgment is the starting point. Our guide to county court judgments explains how you get there.

When can a court make one?

The court can make an order only if several things are true:

• The creditor already has a county court judgment or similar order against you
• You are behind on the payments ordered
• You owe more than £50
• You are an employee, rather than self-employed or living on benefits

How it compares with other enforcement routes

A creditor with a judgment has several options. Seeing them side by side shows why an AEO is often chosen when you are in work.

What the court sends you

When a creditor applies, the court sends you a form asking about your finances. You are asked for your employer's details, income, outgoings, other debts and court orders, and how much you can afford. Complete and return it on time. If you do not, the court may decide using the creditor's figures, and the amount taken could be higher than you can manage.

Be accurate and keep copies. A realistic statement of income and essential costs is your best protection, and a free adviser can help you complete it.

How deductions work

• The court sends the order to your employer, who must start deductions the next time they pay you
• Your employer works out the deduction each payday, pays you the rest and sends the deducted money to the court
• Your employer can take £1 from your wages each time as an administration charge
• Deductions stop when the debt, including any court costs, is paid
• Employers and employees can be fined for failing to deduct or for knowingly giving false earnings information

Challenging or changing an order

You usually have 14 days to tell the court in writing if you disagree with the proposed terms, and the creditor has the same period. A hearing may follow in private with a district judge, where you can explain what you can afford. At that hearing take your budget, proof of income and details of your other debts.

If your circumstances change later, for example you lose income or take on new essential costs, you can ask the court to vary or discharge the order. Tell the court promptly rather than missing payments.

Completing the court form well

The form is your main chance to shape the outcome, so treat it carefully.

• Use your most recent payslips and bank statements for income
• Include genuine essential costs, such as rent or mortgage, council tax, utilities, food, transport and childcare
• List your other debts and any other court orders, because the court needs the full picture
• Do not understate your income or leave out items, as false information can lead to a penalty
• Say what you can realistically pay, and explain any risk to your job
• Return it before the deadline, keeping a copy and proof of posting

If you fall behind again

An order does not end the creditor's other options if it stops working, for example because you change jobs or lose work. Contact the court and the creditor as soon as your situation changes. Early contact usually leads to a workable change, while silence can lead to more costs, bailiffBailiffA bailiff, now formally called an enforcement agent, is a person authorised to collect certain debts by taking control of goods or collecting payment.Read more → action or a different enforcement route. Check which debts to deal with first in our priority debts guide.

Other ways to avoid one

Before an order is made, you may be able to avoid it by offering a payment arrangement the creditor will accept, or by asking the court to vary the judgment to affordable instalments. If you have several debts, an adviser can look at whether a formal solution fits. The priority and non-priority debts guide helps you decide what to pay first, because court orders are treated seriously.

Getting free help

You do not need to pay anyone to deal with a court form. Citizens Advice, MoneyHelper, StepChangeStepChange Explained: What It Does and How It WorksWhat the debt charity StepChange offers, how its free debt advice and debt management plans work, who it suits and what to expect when you contact them.Read more → and National DebtlineNational Debtline: How It Works, When to CallWhat National Debtline is, who runs it, what it can help with, how to get free advice by phone, webchat or online tools, and what to expect.Read more → offer free, independent help with the paperwork and can speak to a creditor on your behalf. See our comparison of free debt advice charities if you are not sure which to choose.