Tenancy Deposit Disputes [FAQ]

Tenancy Deposit Schemes (TDS) became compulsory for all residential ASTs created on or after 6 April 2007

Q1: How can I obtain possession if I have failed to register the deposit?

A landlord’s obligation is to place the deposit in an authorized TDS and comply with the “initial requirements” imposed by the authorised TDS within 30 days from the date of receipt of the deposit. The 30-day period only applies where the deposit has been received on or after 6 April 2012. Before that, the deadline was 14 days.

In this situation, a landlord may have the following options:

  • Return the deposit and issue proceedings under standard possession procedure
  • Serve a S8 Notice

Q2: Can I obtain possession if I have protected the deposit late?

Protecting the deposit in a TDS after the relevant 14 or 30-day deadline has passed will not allow the landlord to serve a section 21 notice, since the landlord has missed the deadline and cannot rectify this retrospectively.

Q3: Can I obtain possession if I have failed to provide prescribed information?

A landlord cannot serve a section 21 notice where the prescribed information has not been given. Certain prescribed information must be provided to the tenant within 30 days of receipt of the deposit or within 14 days where the deposit was received before 6 April 2012.

Q4: Can I obtain possession if I have provided prescribed information late?

Section 215(2) Housing Act 2004 refers to the landlord not being able to recover possession of the premises “until such time” as the Prescribed Information has been provided. In other words, the landlord will be able to serve a valid section 21 notice, after “late” service of the Prescribed Information.

Q5: Is rent in advance a deposit?

It has been held that a genuine advance payment of rent does not constitute a tenancy deposit. For a payment to amount to a tenancy deposit, it has to be made as security for either the performance of the tenant’s obligations or the discharge of any liability arising under or in connection with the relevant tenancy. There is a difference between money paid to discharge an existing obligation and money paid as security for such an obligation.

Q6: What if I live overseas?

A landlord who ordinarily lives overseas, will still be required to join a TDS if the property that is let on an AST is located in England or Wales.

Q7: What if I choose not to join a TDS?

If a tenancy deposit has been paid in connection with an AST, a landlord cannot serve notice under section 21 to recover possession if at the time the section 21 notice is served the deposit is not being held in accordance with an authorised TDS.

A landlord faces financial penalties for not complying with tenancy deposit obligations. This can include being ordered to pay the deposit to the tenant and pay the tenant or relevant person within 14 days a sum of money equal to between one and three times the amount of the deposit. This applies whether the tenancy is continuing or not.

For specialist advice in relation to tenancy deposit disputes please contact us.

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