Is It Illegal to Not Protect a Tenant’s Deposit?

With all the responsibilities and regulations intended for landlords, it is vital for them to stay updated with their legal obligations, especially when they are dealing with new or first-time tenants. In the same manner, tenants also need to be constantly reminded about their responsibilities in ensuring a good professional relationship with their landlords and stress and problem-free tenancy.

One of the common landlord-tenant disputes in the UK involves tenancy deposits. Deposits can be defined as money that tenants are required to pay their landlords before moving into their rented homes. Tenancy deposits are an assurance that tenants will keep their end of the deal and follow the terms of the tenancy agreement throughout their stay in the property. 

Additionally, they also serve as an assurance that landlords have something to use in case their tenants leave the property damaged or if there are rent arrears. The money will be used to pay for repair costs and the arrears.

Tenancy deposit protection schemes

Once the landlord has their tenant’s deposit in their hands, they become responsible for the money (although it remains the tenant’s property). The next thing they are expected to do is protect their tenant’s deposit money by placing it into a tenancy deposit protection scheme. This applies to tenants who are under an assured shorthold tenancy.

In England and Wales, there are several government-approved tenancy deposit protection schemes: Deposit Protection Service or DPS, mydeposits, and Tenancy Deposit Scheme or TDS. Landlords can choose one from these scheme providers and have their tenant’s deposit registered or enrolled into it for protection.

Deposits are protected so they are kept safe throughout the duration of the tenancy. Additionally, protecting the tenant’s deposit will also prevent landlords from using the money for their personal use.

When the tenancy ends, landlords are obligated to return the deposit to their tenants, as long as there is no damage to the property and that rent is paid in full. 

Landlords are expected to comply with the requirements and laws on tenancy deposit protection. If a landlord has no intention of getting their tenant’s deposit protected, tenants can file a case against them and bring them to court. Not protecting a tenant’s deposit breaks the law and the landlord can be liable for up to three times the deposit amount in compensation . 

Requirements for protecting tenancy deposits

The Tenancy Deposit Protection or TDP legislation specifies that landlords should protect tenant deposits 30 days after they receive it. 

After the deposit is entered into a protection scheme, landlords are required to provide their tenants with prescribed information, which is a list of details about the deposit protection. The prescribed information contains essential information such as:

  • Landlord or letting agency’s contact details
  • Deposit amount or value
  • Address of the tenancy
  • If a third party paid the deposit, tenants need to provide the details of that “relevant person”
  • Which tenancy deposit scheme the money was registered with
  • Reason or reasons why the deposit may have deductions when the tenancy ends (such as rent arrears and damages to the property)
  • Instructions on how the deposit can be claimed
  • What to do in case of a deposit dispute when the tenant  or the landlord ends the tenancy

If your landlord does not protect your deposit

If you have handed over your deposit to your landlord, you have 30 days to wait for feedback if your money was placed in a protection scheme. If you do not get confirmation from your landlord, or if you find out that your landlord has not protected your deposit, you are allowed to file a claim against them.

Once you have verified that your deposit has not been protected, you have the option to bring your landlord to court. The court will then evaluate the case and determine if they should require the landlord to directly pay back your deposit or ask them to pay a deposit protection compensation penalty that is worth up to three times the value of your deposit. 

If your landlord did not protect your deposit since the start of your tenancy and did not provide you with the prescribed information within the time frame provided to them, talk to your landlord and ask for an explanation or reasons. If they do not respond to you, get in touch with the three government-approved tenancy deposit schemes to verify the status of your deposit.   

Bringing your case to the court means you’ll have to present evidence that you paid your deposit. So, be sure you have all the documents that can serve as proof of your payment and that the landlord accepted the deposit.

Filing a claim

If you want to increase your chances of winning a tenancy protection compensation claim, you should work with a team of solicitors who are experienced in tenancy deposits. The solicitors at Tenancy Deposit Claims are regulated and authorised by The Solicitors Regulation Authority, so you are guaranteed that they know what they are doing. They know how to protect and help you get back your deposit from your landlord. They will work and fight with you every step of the way – and you won’t have to worry about additional spending because one of Tenancy Deposit Claims’ main features is a no-win-no-fee guarantee.

Get in touch with their solicitors now and be prepared to claim your deposit.