A few questions have been raised on the Property 118 forum concerning how deposit protection comes to an end. Some comments on the site have caused some TDS members to become unnecessarily concerned that deposits may become unprotected without them knowing – we seek to clarify some of those comments.
Registering deposits and renewing protection
Members of the Tenancy Deposit Scheme for Landlords: This section of the scheme is pay as you go, and the fee paid per tenancy deposit is for the lifetime of the tenancy agreement. It also includes continuing protection where a tenancy agreement continues on a same terms statutory periodic tenancy, providing member landlords update the TDS Tenancy Database to reflect this. Where this doesn’t happen, protection ends and both the landlord and tenants are notified. Happily, we have plenty of email reminders before this to make sure this doesn’t get missed! Both the landlord and tenant receive reminders 2 months in advance, and if no action is taken, emails are sent again 1 month in advance, 2 weeks in advance, and on the day the fixed term tenancy ends. N.B. This is only for landlords who are members of TDS – if you use a letting agent who is a member, protection should be done by them and you don’t usually need to do anything or have any contact with us unless a dispute is raised.
Letting Agents: This section of the scheme is an annual membership subscription and deposits are protected for as long as they are registered on the TDS tenancy database. Members can help themselves best by ensuring that they keep registered tenancies up to date to reflect changes to the tenancy agreement.
Agents who have registered a deposit to be part of the Let Only Scheme must ensure that they keep registered tenancies as per the tenancy agreement as this section of the scheme works on a pay as you go basis.
Should prescribed information be served on renewal?
The requirements to protect the deposit and provide the Prescribed Information apply as from the time the deposit is received. Therefore the Department for Communities and Local Government advise us that in their view, unless the landlord returns the original deposit and receives a new one, a landlord will not incur a penalty for failing to provide the Prescribed Information whenever the tenancy is renewed (provided no terms change except the end date on the renewed tenancy. Where other terms, the rent or the tenants change on a renewal then the position will of course be different). In any event avoiding the penalty is simple as no penalty applies where the landlord has already complied with the requirements of an authorised TDP scheme and provided the Prescribed Information to the tenant and any relevant person.
Members can choose to take a cautious approach and serve Prescribed Information with each tenancy renewal. It is up to members as to whether they do this, there is no penalty for serving it too many times!