A tenancy deposit is a sum paid by the tenant that must be legally held in an officially recognised deposit scheme for the duration of the tenancy. It is used to guard against: damage to the property, unpaid rent and other unpaid costs that are the tenant’s responsibility.
Register your tenants deposit or you could be fined 3 times the deposit amount.
Get an inventory of the property – it means you have proof of the property’s condition before your tenants move in and is very helpful during disputes.
Document everything – treat your property like a business. Make sure you can account for every payment received, and every expense paid.
Why does it need to be held in an officially recognised deposit scheme? Deposits have to be registered by the landlord within 30 days of the tenancy commencing. This prevents landlords refusing to return the deposit to the tenant, and with the help of the Tenancy Deposit Dispute Service means there’s an independent adjudicator whenever there is a deposit dispute. If the deposit isn’t registered within 30 days, the landlord could face a fine of three times the deposit amount.
How can an inventory help with the deposit? Inventories compare the state of the property when tenants move in (check in) to when they leave the property (check out). The inventory is only concerned with the comparison between the two dates – if the property was in disrepair before the tenants moved in, and if it’s still in disrepair when the tenants leave – no deposit should be deducted.
What if there is a dispute? The Tenancy Deposit Dispute Service is a free service that’s available if there is any deposit dispute. The key point here is proof of the offence. Evidence taken into account is: legality of the tenancy agreement, the inventory, photographic evidence, invoices/receipts, cleaning charges, account statements and utility bills/charges.
How do I register my deposit? As part of our tenant sign-up pack, we’ll register your deposit in the mydeposits scheme, as well as draw up your tenancy agreement and collect the first month’s rent. Just give us a call on 0333 240 1220 to set it up.
Staff Top Tip: “An inventory is such an important document for a tenancy. Because of deposit legislation, there is no leeway when it comes to disputes: there has to be proof. A detailed inventory (with photographic evidence as support) will solve most of the problems encountered by the Tenancy Deposit Dispute Service.” TJ – Upad Account Executive