Before entering any rental property, the tenant is charged a security deposit. This security ensures that the property is safe for the landlord if the tenant breaks any tenancy agreement conditions.
However, at the same time, landlords are required to protect the tenancy deposit. So, when the tenant leaves the property, they can easily get back their security money.
Landlords are legally required to protect the tenant’s deposit money on the government-approved tenancy deposit protection scheme.
This scheme is meant to protect the rights of tenants and landlords. So, whether you are a tenant or a landlord, this guide will help you with all the information you need to know about the tenancy deposit protection scheme.
What Is Tenancy Deposit Protection Scheme?
A tenant’s deposit is like security money paid by the tenant to the landlord. The tenant’s money is equivalent to 5 weeks’ rent. It is paid with the first month’s rent after the tenancy agreement is signed.
In most parts of the UK, the landlord needs to register the security money under the deposit protection scheme. This scheme protects the security money of the tenant and safely returns it to the tenant when they leave the property.
When leaving the property, the property is examined for any damage. If there is any damage to the property, it is deducted from the tenancy deposit.
The scheme is not only beneficial for the landlord, but it also protects the tenant. In case the landlord didn’t want to pay the tenancy money on a false claim, you can file for the tenancy deposit protection compensation claim.
Types Of Tenancy Deposit Protection Schemes
After the tenant has paid the tenancy deposit, the landlord or the agency must protect the deposit by paying it in the tenancy deposit protection scheme. Once the process is completed, the landlord must provide detailed information about the deposit.
The tenancy protection schemes that a landlord could use:
Insurance Based Scheme
Insurance-based schemes allow the landlord to keep the tenancy deposit in their bank account instead of giving the money to the scheme provider. However, to use this scheme, the landlord still needs to register with a scheme provider and need to pay the premium to protect the deposit.
At the end of the tenancy, the landlord is responsible for giving back the tenancy deposit money. If the landlord refuses to give money in any circumstances, a legal claim can be made.
Unlike the insured scheme, where the landlord can keep tenancy money in their bank account, a custodial scheme requires the landlord to give tenancy money to the scheme provider.
The scheme provider will hold the tenancy money and will be held responsible for giving back the money at the end of the tenancy. Both tenant and landlord can ask for the tenancy deposit based on possible deduction at the end of the tenancy.
How To Check If Your Deposit Is Protected
According to the rules and regulations, your landlord’s responsibility is to provide you with all the detailed information about the tenancy deposit.
Alternatively, even if you receive prescribed information from the landlord, you can check the information online on the registered tenancy deposit protection schemes platform.
To find relevant information, you need the following information.
- Tenancy start date.
- Deposit amount.
Which Deposit Protection Scheme Should You Use?
Landlords should always use government-approved tenancy deposit protection schemes because there are many scheme providers that are simply fake and take away all the deposits.
We have already discussed these schemes in detail. Choosing between the two schemes entirely comes down to the landlord’s reference. Depending on how landlords want to handle the security deposit money, they can go either way.
Information Landlords Must Give Tenants
Once your landlord has received your tenancy deposit, they have 30 days to put that money into a tenancy deposit protection scheme and offer you all the necessary details.
Here is a list of details that tenants must be expecting.
- How much the deposit has been paid.
- The address of the rented property.
- How the deposit is protected.
- The name and the contact details of the TDP.
- Scheme provider agency’s name and contact details.
- How the scheme provider will keep the deposit.
- The process of getting the deposit back.
- Steps can be taken when you can’t reach out to the landlord.
- All the legal actions can be taken if there is any dispute.
Ensure that you are getting all this information with the prescribed document and keep it secure till the end of the lease.
Tenancy Deposit Rules
When a landlord receives tenancy money, there are certain rules that must be followed when protecting against the tenant’s deposit.
The rules are as follows:
- All the short-end tenancy must be protected under the government-authorized TDP scheme.
- After the tenancy money is received, the landlord or the scheme provider must protect the money under a particular time frame. The timeframe may vary from 14 days to 30 days, depending on where you live in the UK.
- Once the deposit is complete, the landlord must give detailed information to the tenant. This must be done within 30 days of the deposit.
At The End Of Your Tenancy
A tenancy deposit is an important factor while looking for a house to rent. This is the security for the landlord who rents their property to individuals.
A tenancy deposit is also known as a security deposit. The reason is simple; if the tenant cannot pay their rent or damage the property in any way, tenancy money is used to cover up the expenses.
The deposit money needs to be returned to the tenant within ten days. In case of any dispute with the tenant or landlord, the tenancy deposit is kept safe in the hands of the tenancy deposit protection scheme provider.
Once the conflict is resolved, the tenancy deposit is given to the individuals where it belongs.