Tenancy Deposit Schemes Are Now Compulsory

If you are a UK landlord and take a deposit for your rental property you must place this with one of three such schemes which been authorised.

* The Deposit Protection Service - the only custodial deposit protection scheme - is free to use.

* Tenancy Deposit Solutions Ltd is a partnership between the National Landlords Association and Hamilton Fraser Insurance. This insurance-based tenancy deposit protection scheme enables landlords to hold deposits.

* The Tenancy Deposit Scheme is an insurance-backed scheme that enables landlords to hold deposits.

When a landlord receives a deposit he or she has 14 days to comply with the requirements of one of the above schemes. The landlord must also, within two weeks and inform the tenant in writing of:

* Full name, address, telephone number, email address and any fax number of the scheme administrator of the authorised tenancy deposit scheme applying to the deposit;

* Information contained in a leaflet supplied by the scheme administrator to the landlord which explains the operation of the relevant Housing Act provisions.

* The procedures that apply under the scheme by which an amount in respect of a deposit may be paid or repaid to the tenant at the end of the tenancy.

* The procedures that apply under the scheme where either the landlord or the tenant is not contactable at the end of the tenancy.

* The procedures that apply under the scheme where the landlord and the tenant dispute the amount to be paid or repaid to the tenant in respect of the deposit.

* The facilities available under the scheme for enabling a dispute relating to the deposit to be resolved without recourse to litigation.

There is no requirement in the Act for the tenancy agreement itself to specify which deposit protection scheme has been used although landlords may do so if they so wish.

Tenancy Deposit Solutions has no recommended wording but issues a certificate to landlords that can be used to provide information to tenants and to provide proof of compliance with the Act. The Tenancy Deposit Scheme on the other hand has a form of wording which it requires members to use - and which is only available to members.

At the end of the tenancy, if the landlord and tenant agree how the deposit should be divided, they will tell the scheme they are using what they have agreed and the money will be paid out accordingly. Should there be a dispute over the deposit, the scheme will hold the amount until the dispute resolution service or courts decide what is fair.

Both custodial and insured schemes feature alternative dispute procedures that can be called on to settle disputes.

For further information on tenancy deposit schemes visit tenancy-deposit-schemes.co.uk. If you would like to download an up to date tenancy agreement for your rental property visit tenancy-agreements.net.

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