Please Note: This Article is 9 years old. This increases the likelihood that some or all of it's content is now outdated.

Key Points:

  • Tenancy Deposit Scheme – From 6 April 2007, all deposits taken by landlords for an Assured Shorthold Tenancies in England and Wales (the vast majority of tenancies), must be protected by a tenancy deposit protection scheme.
  • From this date, tenants can ask their landlord or his agent about the details of the scheme when signing a new tenancy agreement.

The Tenancy Deposit Schemes:

The Tenancy Deposit Schemes

The Custodial Scheme:

The custodial scheme is to be provided free of charge for landlords and agents, paid for by the interest earned on the monies deposited into the scheme fund. It is to be run by  financial and investor services company Computershare Investor Services Plc who have been awarded a contract by Government.

This company have administered a similar deposit scheme in the Australian state of Victoria for the last eight years. Online self-service will allow landlords to register and make deposit payments, transfers and repayments 24 hours a day.

Paper based transactions will also be supported. Help and advice will be available through a dedicated call centre during office hours. An independent Alternative Dispute Resolution (ADR) service, run by the Chartered Institute of Arbitrators, will help to resolve any disputes quickly and without the need for court action.

How does The DPS work?

The tenant pays the landlord or letting agent their deposit. The landlord/agent pays the deposit into The DPS within 14 days of receiving it. Following receipt of the deposit, The DPS will provide confirmation and details of the protection scheme being used to both the landlord/agent and the tenant.

The tenant pays the deposit to the landlord/agent who pays it into The DPS within 14 days of receiving it.

The DPS will provide confirmation and details of the scheme to both the landlord/agent and the tenant. At the end of the tenancy, the landlord/agent and the tenant agree repayment of the deposit and inform the scheme.

The deposit repayment, divided accordingly and including any interest accrued, will be paid to each party within 10 days.

If there is a dispute, The DPS administrators return any undisputed amount (plus interest) to the relevant party, but hold the disputed portion until the ADR service or the courts decide what is fair.

Example—A tenant pays a deposit of £800. At the end of the tenancy, the landlord wishes to keep £90 to pay for cleaning the flat and the tenant agrees.

Example 2—A tenant pays a deposit of £950.

At the end of the tenancy, the landlord says he wishes to keep £200 to pay for damaged furniture. The tenant disagrees, claiming the furniture was damaged before. Both agree to use the Alternative Dispute Resolution (ADR) service. £750 (plus interest) is returned to the tenant, but the disputed £200 (plus interest) is safeguarded until the dispute is settled.

The Insurance Scheme (1)

mydeposits is an insurance based government authorised deposit protection scheme, designed for landlords in England and Wales.

Members pay a small fee to protect each deposit that enables them to keep hold of the deposit for the duration of the tenancy. The protection covers the full fixed tenancy and a rolling Statutory Periodic Tenancy thereafter.

At the end of the tenancy, if the landlord and tenant cannot agree over any proposed deductions to the deposit money, mydeposits provides free alternative dispute resolution (ADR) to the member and their tenant, as an alternative to court.

mydeposits is endorsed by the National Landlords Association, and Hamilton Fraser Insurance. All landlords can join and use mydeposits:

There is a one off joining fee of £14.40* to join the scheme online and then a fee to protect each deposit.

Pay as you go protection fees:

Deposit Amount Protection fee
Up to £500 £18
Over £500 £24

Full NLA members can join mydeposits for £5 and received 20% discount on all protection fees.

For more information visit

Landlords in Scotland can also protect their deposits with the custodial scheme mydeposits Scotland. For more information visit

Since April 2013, landlords and letting agents in Northern Ireland must now also protect their tenant’s deposits with a government authorised scheme. mydeposits Northern Ireland provides both custodial and insurance based deposit protection options. For more information visit

*This is current pricing and is subject to change.

Insurance Scheme (2)

The Tenancy Deposit Scheme run by TDS was originally set-up for regulated agents around 5 years ago. Still primarily aimed at letting agents, the scheme does however make provision for landlords to register.

Regulated agents are members of the Association of Residential Letting Agents, the Royal Institution of Chartered Surveyors, the National Association of Estate Agents, The National Approved Letting Scheme (NALS) or other bodies which regulate the activities of their members and are covered by a recognised bonding scheme which protects and insures deposits.

The agent or landlord holds the deposit as at present or in a special client account. A company called The Dispute Service (The Dispute Service Limited) has been set-up to ensure protection.

If there is no dispute the agent or landlord repays the deposit, but if there is a dispute the agent or landlord is given a couple of weeks to resolve it. After that, any disputed amount is transferred to TDSL and an adjudicator is appointed who will issue a decision within 10 working days of receiving all the necessary evidence.

Fees for landlords (Ex VAT per property, per year)

  • Members of landlords’ trade associations £40.00
  • Unaffiliated landlord £95.00
  • Fees for members of landlord accreditation or other schemes to be determined.

Full details in TDS web

Please Note: This Article is 9 years old. This increases the likelihood that some or all of it's content is now outdated.


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