Tenancy deposit protection
The requirement on landlords (and their agents) to protect tenancy deposits is mandatory across the UK, although the detailed provisions vary in the respective countries of the UK.
This section reviews the legislative requirements in England and Wales, Scotland and Northern Ireland, as there are some significant differences in relation to:
- when deposits need to be protected
- what tenancies are covered by the legislation
- what information needs to be provided by landlords
- how quickly deposits must be protected
- the types of scheme (insurance-backed or custodial) that apply and
- the enforcement provisions that are available in the event of non-compliance.
The legislation in this area (in particular in England and Wales) has been subject to a number of challenges in the courts and, as a result, the legislation has been amended a number of times. Just before the July 2024 general election, the Renters (Reform) Bill failed to make it into law. As a result, the Labour government has decided to resurrect many of its provisions in the Renters Rights Bill which was introduced in the autumn of 2024. This will include:
- the abolition of so called ‘no fault evictions’ using the s21 powers in the Housing Act 1988
- additional mandatory and discretionary grounds for eviction
- the application of the decent homes standard to the private rented sector, and
- the introduction of a PRS Ombudsman.
This is dependent on how much of the proposed bill becomes legislation in 2025.
In Wales, the Renting Homes (Wales) Act 2016 enables the Welsh government in due course to introduce its own version of tenancy deposit protection. The Renting Homes (Fees Etc.) (Wales) Act 2019, banning landlords and agents from charging fees to tenants, came into effect on 1 September 2019 in Wales.
This section is maintained by Steve Harriott, the Group Chief Executive of The Dispute Service Ltd.