Tenancy deposit
England
A tenancy deposit is a sum a tenant pays at the start of a tenancy as security against unpaid rent, damage beyond fair wear and tear, or other breaches of the tenancy agreement. In England and Wales, landlords must protect it in a government-approved scheme within 30 days of receiving it, under Part 6, Chapter 4 of the Housing Act 2004, and return it at the end of the tenancy less any agreed or adjudicated deductions.
The deposit remains the tenant's money throughout. It is not a fee and it is not income for the landlord.
How much deposit can a landlord take?
The Tenant Fees Act 2019 caps the deposit by annual rent:
Annual rent | Maximum deposit |
|---|---|
Less than £50,000 | 5 weeks' rent |
£50,000 or more | 6 weeks' rent |
To work out five weeks' rent, divide the annual rent by 52 and multiply by five. On £1,200 a month, that is £14,400 ÷ 52 × 5, or £1,384.61. Taking more than the cap is a prohibited payment, and the excess must be refunded. Our entry on the tenancy deposit cap covers edge cases such as rent changes and joint tenancies.
When should a tenancy deposit be paid?
Most landlords take the deposit when the tenancy agreement is signed, before the tenant moves in. The 30-day protection clock starts on the day the landlord or agent receives the money, not on the day the tenancy starts. A holding deposit taken to reserve the property is separate, is capped at one week's rent, and must be refunded or put towards the first rent or deposit.
How must a tenancy deposit be protected?
Within 30 days of receiving the deposit, the landlord must do two separate things:
place it in one of the three government-approved schemes: the Deposit Protection Service, MyDeposits or the Tenancy Deposit Scheme
give the tenant the prescribed information, which explains where the deposit is held and how to get it back
Each scheme offers custodial protection, where the scheme holds the money for free, and insured protection, where the landlord or agent keeps it and pays a fee. Protecting the deposit does not count as serving the information, so both steps need doing and evidencing. Scotland and Northern Ireland run their own separate schemes and rules.
What can a landlord deduct?
Deductions must be justified by the tenancy agreement and backed by evidence. Permitted deductions include:
unpaid rent
damage beyond fair wear and tear
missing or broken items listed on the inventory
cleaning, where the property is left materially dirtier than at check-in
A landlord cannot charge for normal wear and tear, or put the tenant's money towards improvements. Where a worn item is replaced, adjudicators apportion the cost by the item's age and remaining life rather than awarding the full replacement price.
How is a tenancy deposit paid back?
At the end of the tenancy, the landlord proposes any deductions in writing, ideally against the check-in and check-out reports. Once both sides agree the amount, the deposit must be returned within 10 days. If they cannot agree, either party can raise a dispute with the scheme, whose adjudication service is free and decides the disputed amount on the evidence. Our guide to handling tenancy deposit disputes fairly walks through the evidence adjudicators look for.
From working with self-managing landlords across the UK, the claims that fail are rarely about the damage itself. They fail because the check-in report is missing, the photos are undated or the deductions were never itemised, which is why the evidence trail matters more than the argument.
What happens if a deposit is not protected?
The consequences are significant on two fronts:
Penalty: the tenant can apply to the county court, which must order the landlord to pay between one and three times the deposit, as well as protect or return it
Possession: since 1 May 2026, the Renters' Rights Act 2025 means a court cannot grant possession of an assured tenancy on most grounds until the deposit is protected and the information served, or the deposit has been returned. Only Grounds 7A and 14, for serious and anti-social behaviour, are excepted.
Our step-by-step guide on how to protect a tenancy deposit covers registration with each scheme. August's compliance checklist tracks the 30-day deadline and stores the deposit certificate and prescribed information against each tenancy, so the evidence is ready if it is ever needed.
Frequently asked questions
How long does a landlord have to protect a tenancy deposit?
30 days from receiving it. The prescribed information must be given to the tenant within the same 30 days.
What is the maximum tenancy deposit?
Five weeks' rent where the annual rent is less than £50,000, and six weeks' rent where it is £50,000 or more.
How long does a landlord have to return a deposit?
Within 10 days of the landlord and tenant agreeing how much will be returned. Disputed amounts stay protected until the scheme's adjudicator decides.
What are the three deposit protection schemes?
In England and Wales: the Deposit Protection Service (DPS), MyDeposits and the Tenancy Deposit Scheme (TDS). All three offer custodial and insured protection and free dispute resolution.
