Tenancy Deposits in England

A deposit is one of only a few payments tenants can be charged

In England's private rented sector, the Tenant Fees Act prohibits most letting fees, and a deposit above the cap is a prohibited payment. Under the Act, a landlord or letting agent may charge rent, a refundable tenancy deposit and a refundable holding deposit, along with a short list of other payments. These include payments linked to early termination requested by the tenant, utilities, communication services, TV licence and Council Tax, and a default fee for late rent or a replacement lost key or security device where the tenancy agreement requires it. A charge for varying, assigning or novating a tenancy is also allowed, and it is capped unless reasonably incurred costs are higher.

The cap on the tenancy deposit depends on annual rent. Rent below £50,000 a year allows 5 weeks' rent, and rent at or above that level allows 6 weeks' rent. A holding deposit, which reserves a property before the tenancy begins, is a separate payment with its own limit of 1 week's rent.

This page covers England. Scotland, Wales and Northern Ireland have their own rules on tenancy deposits.

The landlord must protect the deposit and pass on specific details

Within 30 days of receiving the deposit, the landlord must protect it in a government-approved tenancy deposit protection (TDP) scheme and explain to the tenants how it is protected. Tenants must be told which scheme is holding the money, and how to contact both the scheme and its dispute resolution service. They must also be given the property address and the amount of deposit paid.

The landlord or letting agency must provide their own name and contact details. The same applies to anyone else who paid the deposit on the tenants' behalf.

The tenants must also be told why some or all of the deposit could be withheld, for example to fix damage. At the end of the tenancy, they need to know how to apply for the money back, what to do if the landlord cannot be reached, and what to do if there is a dispute over the amount returned.

Tenants can go to court if the deposit was not protected

If a landlord did not use a TDP scheme when required to, the tenants can apply to a county court at any point while the tenancy runs.

If the court finds the deposit was unprotected, the landlord can be ordered to take one of two steps: pay the money back to the tenants, or place it in a custodial TDP scheme's bank account. Either step must be completed within a fixed period set after the order.

The court can also require the landlord to pay the tenants a further sum of Up to 3 times the deposit, on top of the deposit and due within that same period.