Deposit protection schemes

When you pay a security deposit for an standard occupation contract, the landlord or letting agent must protect your deposit through a Government-backed protection scheme. These are often referred to as ‘tenancy deposit protection schemes’.

This rule applies to all standard occupation contracts. If you moved into your home before 6 April 2007 and have not signed a renewal agreement since that date, your deposit may not need to be protected. Get help if you are unsure.

Am I protected by a deposit protection scheme?

You security deposit should be protected by a deposit protection scheme if you have been:

  • renting a home from a private landlord or letting agent since the 6 April 2007
  • your contract is an standard occupation contract, and
  • you have paid a security deposit (not the same as rent in advance or a holding deposit).

It doesn’t matter whether it is the contract-holder, or someone else such as a parent, or a local authority, who provides the money for the security deposit.

What does my landlord or agent have to do?

Our animated videos on the right hand side of this page explain what your landlord should do with your security deposit.

If your deposit was paid to a landlord or agent on or after 6 April 2012, within 30 days of receiving it they must:

  • protect your deposit with a government backed scheme, and
  • provide you with certain information. The law calls this ‘required information.’

The ‘required information’ that must be provided to you includes:

  • details of the deposit protection scheme used
  • any information which may be included in a leaflet supplied by the scheme
  • how to get your deposit back when you leave
  • what to do if there is a dispute about its return
  • details of the occupation contract, including the amount of security deposit paid and your landlord’s name, address and contact details, together with a certificate, signed by your landlord confirming these details to be true.

You should also be provided with a copy of the deposit protection certificate, complete with your landlord’s signature.

There are two types of government approved schemes available:

  • a custodial scheme – the landlord or agent pays the security deposit to the scheme, which will keep it until the end of your contract
  • an insurance scheme – the landlord or agent keeps the security deposit but pays insurance premiums to the scheme. This means that the deposit is insured if there is any dispute, and the scheme will repay you the agreed amount directly.

It will be up to your landlord or agent to decide what scheme to use.

Your landlord or agent will have to pay a fee for protecting your security deposit. They should not make you pay this fee, or deduct it from the deposit at the end of your contract.

How can I check if my security deposit is protected?

Your landlord should let you know when your security deposit has been protected, tell you which scheme they have used and provide you with the required information about the scheme.

If they haven’t done this, you can check yourself whether your deposit has been protected in any of the three government-approved deposit protection schemes by clicking on the links below:

How can I get my landlord to protect my security deposit?

Your landlord should protect your deposit without you having to ask, but if they don’t, you can take some steps to try and ensure that they do. Click here for details.

What if my landlord doesn’t comply with the rules?

If your landlord hasn’t protected your security deposit and provided the required information within 30 days, they can be taken to the county court and it can be more difficult for them to end your contract.

County court penalties

If your landlord does not comply with the rules, you can make an application to the county court to order that:

  • your deposit is protected or returned to you and/or
  • you are paid compensation of between 1 and 3 times the amount of the deposit.

Click here to read more about security deposit compensation claims.

Restrictions on eviction

If your landlord does not comply with the rules, there are also restrictions on how they can evict you.

If you have a standard contract you can normally be evicted if the landlord gives a minimum of six months’ notice and then gets a court order. This can be done without the landlord having to give a reason. This is sometimes known as the ‘no fault’ eviction procedure’.

However, if your landlord has not complied with the deposit protection rules, then they cannot use the ‘no fault’ eviction procedure.

Click here to read more about restrictions on eviction.

What if my landlord protects my security deposit late?

If your landlord missed the deadline and protected your deposit outside of the 30 day time limit,  they can only serve a valid ‘no fault’ notice if they return your deposit first (minus any agreed deductions).

You might still be able to apply to the county court for a claim for compensation. Click here to read more about security deposit compensation claims.

What happens at the end of my contract?

When you leave, if you and your landlord or agent both agree on how much of the security deposit you should get back, you should get it back within 10 days of agreeing.

If your deposit was held in a custodial scheme, you will also receive some interest on the deposit. The custodial scheme will repay contract-holders direct, either by cheque or by electronic transfer. Deposits held in the insurance-based schemes will be repaid by the landlord either in cash or by cheque, as they choose. Deposits held in the insurance-based schemes will not pass on any interest to the contract-holder.

What if we don’t agree about whether the security deposit should be paid back?

Your landlord or agent is only entitled to keep all or part of your security deposit if they can show that they have lost out financially because of your actions, for example, if you have caused damage to the property, or you owe rent. Ask your landlord or agent for a breakdown of the specific costs that they are taking out of your deposit. Your landlord or agent cannot keep your deposit to cover putting right normal wear and tear.

If you don’t agree that your landlord or agent should have kept all or part of your deposit, or you disagree with some of the costs that they have taken out of it, then the deposit protection scheme your landlord or agent has used will offer a free service to help resolve disputes.

Information on what you need to do if there is a dispute will be contained in the information your landlord or agent will have given you at the start of your contract (see above). Each scheme has an Alternative Dispute Resolution (ADR) service. When a dispute occurs, and if you and your landlord both agree to use the service, you will have to agree to accept its decision and will not be able to apply to the courts. If you or your landlord do not agree to use the ADR service then the dispute will usually go to the county court.

Click here to read more about going to court to get your security deposit refunded.

Where can I get more information?

The Directgov website has guidance notes on the deposit protection schemes for both landlords and contract-holders.

You could also read our ‘Paying a deposit’ fact sheet or watch our videos on the right hand side of this page.

Other pages in paying for housing

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This page was last updated on: May 18, 2023

Shelter Cymru acknowledges the support of Shelter in allowing us to adapt their content. The information contained on this site is updated and maintained by Shelter Cymru and only gives general guidance on the law in Wales. It should not be regarded or relied upon as a complete or authoritative statement of the law.