A landlord will usually ask for a deposit to safeguard against any damage caused to the property and its contents. Amounts vary but the legal maximum a landlord can charge is two months’ rent. This is a returnable sum and you should obtain a receipt. If at the end of the tenancy there has been no damage to the property beyond reasonable ‘wear and tear’ and no bills remain outstanding, then the deposit should be returned in full.
Tenancy Deposit Scheme
From 6th April 2007 all deposits taken by landlords in relation to assured shorthold tenancies (AST) have to be covered by a Tenancy Deposit Protection scheme. This law was introduced to ensure that when a tenant pays a deposit, he or she is entitled to get all or part of it back.
There are two types of scheme: a custodial scheme and insurance-based scheme. Your landlord will have the option to choose which scheme they use. A landlord will have 30 calendar days to safeguard a deposit from the day he receives it and will have to provide you with prescribed information about the scheme safeguarding the deposit within this time also. In both schemes you will pay the deposit directly to your landlord.
If using one of the insurance based schemes your landlord will keep the deposit but pay a premium to an insurer. At the end of the tenancy, if you and your landlord agree how the deposit should be divided, the landlord returns all or some of the deposit.
If using the custodial scheme your landlord will pay the deposit into the custodial scheme. At the end of the tenancy, if the landlord and tenant agree how the deposit should be allocated, they will tell the scheme, which will pay out the money as agreed.
If you think your landlord has failed to protect your deposit and has failed to provide you with the prescribed information within the 30 days, you can apply for a court order requiring the deposit to be safeguarded or to get the information about the scheme in which the deposit is safeguarded. If a court believes that the landlord has failed to comply with these requirements, or the deposit is not being held in an authorised scheme, the court may order your landlord to return or protect your deposit and could also order the landlord to pay to the tenant a fine of up to three times the deposit amount within 14 days of the making of the order.
The tenant may sue the landlord at any time within 6 years from the date the deposit was taken, so even if your tenancy has come to an end and you have moved out, you are still able to apply for a court order.
To avoid disputes over the return of your deposit:
• Agree with the landlord in writing BEFORE you sign the agreement exactly what the deposit will cover
• Obtain a receipt for the deposit
• Insist that the landlord agrees an inventory with you before you move in
• Take photos as evidence of the condition of the property when you move in
• Before asking for your deposit back at the end of the letting ensure that you replace any broken or missing contents, repair any damage and clean up. Your landlord may legitimately spend part of your deposit on professional cleaning services if the property is left dirty and untidy, take photographs
• Check meter readings when you move in and move out
At the end of the letting your landlord will inspect the property. Be there! Check each item against the inventory and agree a date for the return of the deposit
Always get receipts for any money you pay and keep them safe.
If you have a dispute about a tenancy deposit or are unsure whether your deposit is protected contact the Advice Centre
See Unipol information on tenancy deposits, where you can can download a tenancy deposit enforcement pack. This includes standard template letters you can send to your landlord if you are having problems.