Deposit protection schemes and landlords
Overview
You must place your tenants鈥� deposit in a tenancy deposit protection (TDP) scheme if you rent out your home on an assured shorthold tenancy that started after 6 April 2007.
If you receive a valuable item as a deposit instead of money (for example a car or watch), you do not have to put it in a TDP.
These government-backed schemes ensure your tenants will get their deposit back if they:
- meet the terms of your tenancy agreement
- do not damage the property
- pay the rent and bills
You (or your letting agent) must put your tenants鈥� deposit in the scheme within 30 days of getting it.
Available schemes
You can use any of the following schemes if your property is in England or Wales:
There are separate TDP schemes in and .
All TDP schemes offer you 2 options:
- the scheme hold the deposit for free - known as a 鈥榗ustodial鈥� scheme
- you or the agent holds the deposit and you pay the scheme to insure it - known as an 鈥榠nsured鈥� scheme
At the end of the tenancy
The deposit must be returned to your tenants within 10 days of you both agreeing how much they鈥檒l get back.
If you鈥檙e in a dispute with your tenants
The deposit is protected in the scheme until the issue is settled.
If you鈥檙e in an 鈥榠nsured鈥� scheme, you or the agent must give the deposit to the TDP scheme. They will hold it until the issue is settled.
Holding deposits
If you鈥檝e received a holding deposit from your future tenants (money to 鈥榟old鈥� a property before an agreement is signed), you do not have to protect it. Once they become tenants the holding deposit becomes a deposit, and you must protect it.
Deposits made by a third party
You must use a TDP scheme even if the deposit is paid by someone else, like a rent deposit scheme or a tenant鈥檚 parents.