Finances & Debts When You Go to Prison UK

Going to prison does not stop your financial obligations. Mortgages, rent, utility bills, council tax, and debts all continue to accrue. For many prisoners, the financial damage caused by a sentence is one of the most lasting consequences. Understanding how to protect your finances before and during your sentence can make a significant difference.

Before Sentencing: Prepare Your Finances

If you know you are likely to receive a prison sentence, take these steps before court:

**Grant power of attorney**: Give a trusted family member or solicitor legal authority to manage your bank accounts, property, and bills. This is the single most important step you can take.

**Notify your bank**: Write to your bank explaining your situation. Some banks freeze accounts of prisoners automatically; others do not. Clarify who is authorised to act on your behalf.

**Contact creditors**: Inform mortgage lenders, landlords, utility companies, and creditors that you will be unable to make payments. Some will offer payment holidays or reduced arrangements.

**Arrange bill payments**: Set up direct debits from your account for essential bills, or ask your power of attorney to manage payments from your savings.

**Document everything**: Keep copies of all correspondence, account numbers, and contact details. You will not have easy access to this information once inside.

Mortgages and Home Ownership

If you own your home and have a mortgage, the mortgage payments continue regardless of your imprisonment.

If payments stop, your lender will eventually begin repossession proceedings

Contact your lender as early as possible to discuss forbearance options

Some lenders offer payment holidays for up to 12 months in cases of hardship

If you have mortgage protection insurance, check whether imprisonment triggers a claim

Equity release or selling the property may be necessary if the mortgage is unaffordable long-term

If you are a joint owner, your co-owner remains responsible for the full mortgage. Discuss the situation openly before sentencing.

Rent and Tenancies

If you rent your home, your tenancy continues and rent remains due.

**Assured shorthold tenancies**: Your landlord cannot evict you solely because you are in prison, but rent arrears can lead to eviction under Section 8 or Section 21 proceedings

**Council tenancies**: Local authorities have discretion but may begin possession proceedings for rent arrears. Contact the housing department and explain your situation

**Housing association tenancies**: Similar to council tenancies. Engage with the landlord early

Giving up your tenancy voluntarily may be better than accumulating unmanageable arrears, particularly if you will be away for years.

Council Tax

Council tax continues to be due on your property while you are in prison. However, you may be eligible for:

**Council Tax Reduction**: If your household income falls or you are the only liable person

**Single Person Discount**: If the property is now occupied by only one person

**Exemption**: In some cases, properties left empty by prisoners may qualify for a temporary exemption

Contact your local council's council tax department immediately.

Utility Bills and Insurance

Gas, electricity, water, and insurance bills continue. If the property is unoccupied:

Inform utility providers and ask for reduced standing charge rates

Cancel non-essential services such as broadband and television subscriptions

Check whether your home insurance covers an unoccupied property — many policies limit cover after 30 or 60 days

Consider asking a family member to occupy the property temporarily to maintain insurance and security

Debts and Credit Agreements

Credit cards, loans, hire purchase agreements, and other debts remain enforceable.

Interest and charges continue to accrue

Creditors may pursue your estate or any jointly liable parties

County court judgments can be issued in your absence

Bankruptcy may become unavoidable if debts are unmanageable

If you are facing unmanageable debt, speak to a debt advisor such as StepChange or Citizens Advice before sentencing. They can help negotiate payment plans or assess whether bankruptcy or a debt relief order is appropriate.

Bank Accounts in Prison

Most prisoners' bank accounts remain active during their sentence. However:

Some banks freeze accounts once they learn the account holder is in prison

You cannot operate online banking from prison

You can write to your bank, though responses take weeks

Power of attorney is the most reliable way to ensure your accounts are managed

Some banks have specialist teams for vulnerable customers, including prisoners. Ask to be referred to this team.

Joint Accounts and Shared Debts

If you have joint accounts or debts with a partner, they become solely responsible for managing them. They may also become liable for debts that were previously shared.

Discuss this openly. Some partners choose to close joint accounts to protect their own credit rating. This is a personal decision, but it should be made with full information.

Rebuilding Your Finances After Release

Financial recovery after prison is slow but possible:

Open a basic bank account immediately on release

Check your credit report for defaults, CCJs, or errors

Set up a budget and stick to it

Prioritise rent, council tax, and utility bills over unsecured debts

Seek debt advice if arrears have built up

Build a savings buffer, even if only a few pounds per week

Frequently Asked Questions

Can I go bankrupt from prison?

Yes. You or your power of attorney can petition for bankruptcy. This may be the best option if debts are unmanageable and you have no assets.

Will my partner lose the house if I go to prison?

Not automatically. If your partner can maintain the mortgage or rent, the home is safe. If they cannot, you may need to consider downsizing, selling, or applying for housing benefit.

Can creditors take money from my prison account?

No. Prison accounts are not accessible to external creditors. However, if you have savings in outside bank accounts, those can be pursued.

What happens to my pension while I am in prison?

State Pension and most private pensions continue to accrue. You may not be able to access private pension funds until retirement age.

Can I manage my finances from inside prison?

Limited. You can write to banks, creditors, and government departments. Having power of attorney in place before sentencing makes this far easier.

*Last updated: June 2026.*

What Happens to Your Finances, Debts and Property When You Go to Prison