Are you aware of the new financial penalties facing landlords if they fail to place their tenant’s deposits in an approved scheme within thirty days of receipt of the money?
As of the first of April this year, the new Localism Act instigated by the government to protect tenant’s rights comes into effect. One of its requirements is that money handed over to a landlords or letting agents as a deposit on a rental property, must be placed in a protection scheme in order to safeguard the rights of both tenants and landlords should there be any tenancy disputes at a later date.
Once the money has been deposited, the landlord is required to pass on information to the tenant about the Tenancy Deposit Scheme (TDS) within the thirty-day period. This information includes a leaflet and a deposit protection certificate, plus confirmation that the deposit has been registered on the TDS database.
Should the landlord fail to place the money in the Tenancy Deposit Scheme within the thirty-day period, the tenant has the right to make a claim for up to four times the original amount of their deposit. They can do this as soon as the thirty-day period has expired, even if the landlord is one day late or the tenancy has ended, although the courts will take these factors into account if a case is brought before them.
With such severe financial penalties at stake, it is essential that landlords and letting agents comply with the rules, or they may face numerous claims from savvy tenants.
