TENANCY DEPOSIT SCHEMES
Where does that 4 week (sometimes 6 week) rent deposit goes during your tenancy? If you’re renting a home in England or Wales on an Assured Shorthold Tenancy contract, the deposit you pay to your landlord or letting’s company has to, by law, be held in a government-backed deposit protection scheme.

What are deposit protection schemes
In England and Wales the government back 3 separate schemes – The Deposit Protection Service (DPS), The Tenancy Deposit Scheme (TDS) and MyDeposits

How do the schemes work
Each of the 3 schemes offer what is known as an insured option and a custodial option.
The insured option is where your landlord registers your deposit with a scheme but keeps hold of it themselves for the duration of the tenancy. They will have to pay a fee of about £25 a year for this service, as they will earn interest on the deposit.
The custodial option is where your landlord pays your deposit into a scheme for the duration of the tenancy. This service is free to use because the scheme will keep the interest that is earned. From a tenant’s point of view there is no difference, as your deposit will be protected either way.

How long before the landlord has to lodge your deposit
Within 30 days of receiving your deposit your landlord must place it with their chosen scheme and provider and supply you with the paperwork.

How long is the deposit protection scheme valid for
Your deposit will be protected for the duration of your tenancy, however many times it is renewed, as long as it’s with the same landlord or lettings agent.

Your holding deposit
In some cases a holding deposit is paid to reserve the property before a rental agreement has been signed. When this money becomes part of the deposit it will also have to be lodges with the protection scheme.

Your landlord hasn’t used a tenancy deposit scheme
Firstly, check that your contract is an Assured Shorthold Tenancy agreement – if it is not, your landlord doesn’t have to use a scheme. If it is, give your landlord reasonable time to you’re your deposit protected. If it still doesn’t happen, you can apply to the local county court at any time during your tenancy and they can order your landlord to either pay the deposit back to you or put it with a custodial scheme within 14 days.

The end of the tenancy
Your deposit, minus deductions for any damaged or missing items or any unpaid rent should be returned to you within 10 days. The money will usually be paid straight into your bank account – if this is a BACS transfer it may take three days for it to clear.

I don’t agree with the deductions
If you don’t agree with the amount of deposit you get back and think it is unfair each of the three deposit schemes offers a dispute resolution service known as the Alternative Dispute Resolution.
This service is free and is in place to resolve disagreements without the need to go to court. Your case will be judged by an independent adjudicator and you won’t have to deal directly with your landlord – it is down to the landlord to justify their reasons for withholding some or all of your deposit. If you are still not happy with the outcome your local Citizens Advice is a good place to start or you may have to take your own legal action.
Posted: 19/06/2017
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