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DEPOSITS

We will take a deposit (usually one month rent) from each tenant at the time of agreeing a contract.

From 6 April 2007, all deposits (for rent up to £25,000 per annum) taken by landlords and letting agents for Assured Shorthold Tenancies in England and Wales, must be protected by a tenancy deposit protection scheme.

What are Tenancy Deposit Schemes?

The schemes allow tenants to get all or part of their deposit back when they are entitled to it and encourage tenants and landlords to make a clear agreement from the start on the condition of the property. The schemes:

• allow tenants to get all or part of their deposit back when they are entitled to it

• make any disputes easier to resolve

• encourage tenants and landlords to make a clear agreement from the start on the condition of the property

There are two types of tenancy deposit protection scheme available for landlords and letting agents. All schemes provide a free dispute resolution service.

Insurance-based schemes

• the tenant pays the deposit to the landlord

• the landlord retains the deposit and pays a premium to the insurer - the key difference to the custodial scheme

    Within 14 days of receiving a deposit the landlord or agent must give the tenant the details about how their deposit is protected including:

• the contact details of the tenancy deposit scheme selected

• the landlord or agent’s contact details

• how to apply for the release of the deposit

• information explaining the purpose of the deposit

• what to do if there is a dispute about the deposit

    At the end of the tenancy:

• if an agreement is reached about how the deposit should be divided, the landlord or agent returns all or some of the deposit

• if there is a dispute, the landlord must hand over the disputed amount to the scheme for safekeeping until the dispute is resolved

• if for any reason the landlord fails to comply, the insurance arrangements will ensure the return of the deposit to the tenant if they are entitled to it

Custodial schemes

• the tenant pays the deposit to the landlord or agent

• the landlord or agent then pays the deposit into the scheme

    Within 14 days of receiving a deposit the landlord or agent must give the tenant the details about how their deposit is protected including:

• the contact details of the tenancy deposit scheme selected

• the landlord or agent’s contact details

• how to apply for the release of the deposit

• information explaining the purpose of the deposit

• what to do if there is a dispute about the deposit

    At the end of the tenancy:

• if an agreement is reached about how the deposit should be divided, the scheme will return the deposit, divided in the way agreed by both parties

• if there is a dispute, the scheme will hold the deposit until the dispute resolution service or courts decide what is fair

The Government has awarded contracts to three companies to run tenancy deposit protection schemes:

• Tenancy Deposit Solutions Ltd (TDSL) - an insurance-based scheme
• The Tenancy Deposit Scheme (TDS) - an insurance-based scheme
• The Deposit Protection Service (The DPS) - a custodial-based scheme

For details on the schemes, click here to go to the government website.

We have chosen to use the insurance-based Tenancy Deposit Solutions Ltd (TDSL) scheme to look after all deposits that we take.

For further details on Tenancy Deposit Solutions Ltd click here.