The Housing Act 2004 specifies that no person may require payment of a tenancy deposit in connection with an assured tenancy which is not to be dealt with in accordance with an authorised deposit scheme.

Three such schemes have been authorised:

• The Deposit Protection Service - the only custodial deposit protection scheme - is free to use. For more information, visit www.depositprotection.com or call 0870 707 1 707
• Tenancy Deposit Solutions Ltd is a partnership between the National Landlords Association and Hamilton Fraser Insurance. This insurance-based tenancy deposit protection scheme enables landlords to hold deposits. For more information, visit www.mydeposits.co.uk
• The Tenancy Deposit Scheme is an insurance-backed scheme that enables landlords to hold deposits. For more information, visit www.tds.gb.com or call 0845 226 7837.

When a landlord receives a deposit he or she has 14 days to comply with the requirements of one of the above schemes. The landlord must also, within 14 days inform the tenant in writing of:
• The name, address, telephone number, email address and any fax number of the scheme administrator of the authorised tenancy deposit scheme applying to the deposit;
• Any information contained in a leaflet supplied by the scheme administrator to the landlord which explains the operation of the relevant Housing Act provisions.
• The procedures that apply under the scheme by which an amount in respect of a deposit may be paid or repaid to the tenant at the end of the tenancy.
• The procedures that apply under the scheme where either the landlord or the tenant is not contactable at the end of the tenancy.
• The procedures that apply under the scheme where the landlord and the tenant dispute the amount to be paid or repaid to the tenant in respect of the deposit.
• The facilities available under the scheme for enabling a dispute relating to the deposit to be resolved without recourse to litigation.

There is no requirement in the Act for the tenancy agreement itself to specify which deposit protection scheme has been used although landlords may do so. Tenancy Deposit Solutions has no recommended wording but issues a certificate to landlords that can be used to provide information to tenants and to provide proof of compliance with the Act. The Tenancy Deposit Scheme on the other hand has a form of wording which it requires members to use – and which is only available to members.

At the end of the tenancy, if the landlord and tenant agree how the deposit should be divided, they will tell the scheme they are using what they have agreed and the money will be paid out accordingly. Should there be a dispute over the deposit, the scheme will hold the amount until the dispute resolution service or courts decide what is fair.

Both custodial and insured schemes feature alternative dispute procedures that can be called on to settle disputes.

Landlords who do not take deposits will not have to participate in tenancy protection schemes. Likewise landlords of tenancies that cannot be assured tenancies – such as those with rent in excess of £25,000 a year and holiday lets – are exempt from the requirement.

Working with LetCare, Residential Landlord has developed its own scheme that will both avoid landlords having to take part in deposit protection schemes and provide a high level of security.

The Tenant Guarantee Scheme – go to www.iguarantee.co.uk for details – provides a database of tenants each of whom is covered by his or her own insurance. Once a landlord takes on a scheme member as a tenant the benefit of the insurance is assigned to the landlord.





Deposit protection legislation and guidance

Communities and Local Government guidance

Housing Act 2004

Prescribed information for tenants

Who runs the authorised schemes?

Tenancy deposit scheme news

Slow take up on deposit protection
More than three out of four landlords have not registered for Tenancy Deposit Protection, the government-approved tenancy deposit scheme, says the National Landlords Association. Around 150,000 landlords have registered with a scheme, but a large majority... MORE

Little early support from landlords for deposit protection schemes
For Two thirds of landlords and lettings agents have said they are negative (37.6 per cent) or indifferent (33.7 per cent) to the introduction of mandatory deposit protection. But ‘first indications are that a third of all tenants are aware of the introduction of tenancy deposit protection schemes and their response to the... MORE

Agents sign up to tenancy
deposit scheme alternative
Iguarantee, the alternative to tenancy deposit protection schemes, has already signed up its first letting agent associate. Using the revolutionary no deposit Tenant Guarantee Scheme launched last week, the Barry firm Just4Let will advertise lettings with no deposit, signing up all tenants to the scheme which brings... MORE

Deposit protection comes into effect
As of 6 April, landlords who take deposits when granting assured shorthold tenancies must ‘protect’ those deposits through participation in one of three Government approved schemes. According to Government estimates, the average deposit paid is £700. In 2005/06 11 per cent of tenants did not get their deposit back and barely one in five received the whole amount back. MORE



Warnings on TDS rules: and a viable alternative
There is not enough awareness of the Introduction of tenancy deposit protection rules on 6 April, leading independent letting agent Leaders has warned. This is one of the most important changes to residential letting in the last 20 years and will affect all landlords who put new assured tenancy agreements... MORE

No cost, no hassle answer to new tenant deposit rules
Landlords worried about the high cost and bureaucratic burden of complying with new tenancy deposit protection rules are being offered a revolutionary solution. Residential Landlord has teamed up with Letcare to offer the Tenant Guarantee Scheme. MORE

Tenants targeted as landlords pay up to £95 for deposit protection
Landlords who use the 'insured' option to protect tenancy deposits will have to pay up to £95 for the privilege. This became clear when Tenancy Deposit Solutions - the version of tenancy deposit protection backed by the National Landlords Association - at last announced its fees structure. MORE

NLA warns landlords on deposit protection rules
With just 50 days to go before the introduction of mandatory tenancy deposit protection some 800,000 residential landlords across England & Wales should be preparing now for the 6 April start date, the National Landlords Association has warned. MORE

Deposit protection is on track for April start
Claims that the start of the Tenancy Deposit Protection Scheme is to be further delayed have been rubbished by both Department of Communities and Local Government and the National Landlords Association which is to run the ‘insured’ scheme likely to be used by most landlords. MORE

In brief
A warning to landlords to be ready for new deposit protection rules - the last major provision of the Housing Act 2004 to come into effect - has come from the National Landlords Association. 'The repercussions of non-compliance are severe', said NLA chairman David Salusbury. MORE

NLA chosen to head landlord deposit scheme
Activation of the delayed requirement for rental deposit protection moved a stage nearer this week with announcement of the names of the firms authorised by the Government to run deposit schemes. MORE