Published on 27 May 2022
Deposits where there is an Assured Shorthold Tenancy (AST) are required to be protected under an approved scheme, which is either custodial or insurance-based (or both), and acts independently of agents and landords.
The landlord or agent must:
The Landlord or agent must give the tenant certain information within 30 days covering, for example:
Restrictions and penalties apply if these rules are not followed.
You can use any of the following schemes if your property is in England or Wales:
There are separate TDP schemes in Scotland and Northern Ireland.
All TDP schemes offer you 2 options:
The deposit must be returned to your tenants within 10 days of you both agreeing how much they’ll get back.
The deposit is protected in the scheme until the issue is settled.
If you’re in an ‘insured’ scheme, you or the agent must give the deposit to the TDP scheme. They will hold it until the issue is settled.
There is a dispute resolution service built into all the schemes which is free to use but not mandatory. Where this is used, the decision is binding on both parties. The custodial scheme continues to hold the deposit until resolution. Once settled, payment is made in accordance with the decision of the dispute service within 10 days. With insurance-based schemes, the landlord or agent hands over to the scheme the disputed part of the deposit, and the scheme will hold this until the dispute is resolved. It is then distributed within 10 days.
Having an inventory and schedule of condition at the start of a tenancy, although not mandatory, makes any claim for damages against the deposit much easier to establish as they will be taken as the measure of the state of the property and the landlord’s fixtures and fittings at the start of the tenancy.
Categories: Residential Lettings Best Practice