4th December 2018
Q: How do I protect my tenant’s deposit?
A: A deposit is the money taken by the landlord to cover any damages or rent arrears that arise from the terms listed in the AST. This deposit should remain untouched for the duration of the tenancy.
There are three main schemes available for you to use: the DPS, TDS and mydeposits. Each of these schemes offer practically the same service, but each has their own individual qualities suited to your needs and requirements.
You must keep in mind that protecting the deposit is time sensitive, and must be done within the first 30 days of receiving the deposit. You will need to give the tenant the scheme’s prescribed information that will be sent to you when you have protected the deposit.
Be warned, if you do not protect the deposit you may be fined and will be unable to serve a Section 21 on your tenants. Some landlords have found themselves in this situation.
Depending on which scheme you choose to use, you will need to provide certain information which will include details of anyone that paid towards the deposit.
Fines for not protecting the deposit or providing the prescribed information within the 30 days of receipt will leave you liable to pay the tenant between 1 and 3 times the deposit, along with a court ordering you to return the deposit.
Richard Bond
