Tenancy Deposits
What is a tenancy deposit and why is it taken?
A Tenancy deposit acts as security for landlords in the event a tenant breaches their obligations under the terms of a tenancy agreement - such as causing damage to the property or failing to pay rent. While taking a deposit is not a legal requirement, most landlords choose to request one for added protection.
What should landlords do with a tenancy deposit?
The rules around tenancy deposits are set out in the Housing Act 2004. If a deposit is received from a tenant under an Assured Shorthold, it must be protected in a government-approved Tenancy Deposit Protection (TDP) Scheme within 30 days of receipt.
Landlords are also legally required to provide the Tenant with "prescribed information" about the deposit once it has been protected.
Landlords who fail to protect their Tenants' deposits may be ordered to:
- repay the deposit to the Tenant; and
- pay a penalty of between one and three times the deposit amount
Additionally, Landlords must comply with The Tenant Fees Act 2019, which caps deposit amounts as well as other prohibited payments under a tenancy agreement. Non-compliance can lead to financial penalties.
Note: For Welsh Landlords please refer to Renting Homes Wales for specific guidance.
Explore the full range of tenancy deposit guidance, documents and templates in the list below:
- Guidance for Landlords on Tenancy Deposit Protection
- Receipt for Tenancy Deposit
- Prescribed Information about Deposit Protection
- Form N215 Certificate of Service of Prescribed Information
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