Tenancy Deposit Protection Schemes

Tenants stand to benefit from enhanced security and peace of mind following the introduction of the Tenancy Deposit Protection schemes (TDP), which will offer a faster, cheaper and fairer way of settling any disputes over the return of deposits in the private rental sector.

Since April 2007, landlords entering into new tenancy agreements are now required to place any deposit with a Government authorised scheme, which will safeguard the money and offer independent adjudication in the event of any dispute. Tenants who have kept their rented property in good condition can be confident that they will not have all or part of their deposit withheld on spurious grounds, a common complaint currently made by tenants.

The existence of the alternative dispute resolution service (ADR) will also encourage tenants and landlords to have in place, from the outset, clear agreement on the condition of the property through use of inventories, and agreement on the condition of the property – thus ensuring that landlords are also protected.

TDP will apply to all assured shorthold tenancies (ASTs) in England and Wales, where a deposit is taken. Virtually all new contracts to let a property are ASTs and a contract that is an AST will be clearly marked as one.

However, be aware that there are some restrictions on whether tenancy agreements can be ASTs, based on an annual rental limit of £25,000. This means that if the total rent for the property for a 12 month period exceeds £25,000, a Common Law tenancy is created and so the landlord/agent cannot make use of TDP. Although this figure might seem high, it will affect tenants living in 8 bed houses who pay £61 a week or more for 52 weeks - £61 x 8 x 52 =£25,376.

For further information visit www.direct.gov.uk/tenancydeposit .

Useful leaflets on the Tenancy Deposit Scheme

You can download a useful leaflet on the tenancy deposit scheme by clicking either landlord ortenant. Both of these leaflets will give you important information on the scheme and what it will mean for you as a tenant or as a landlord.

You can also find further advice on the tenant deposit scheme and a special Q & A section by clicking here .