Tenant Deposit Rules Set To Change in 2012

As of 2012, agents and landlords will have 30 days in which to protect a tenant’s deposit, rather than the current 14 day requirement.

The change is part of amendents to tenancy deposit protection in the new Localism Act 2011. These were made in response to court cases over the rights of a tenant to sue for a breach of the deposit protection legislation or when deposit money was not protected within 14 days, but was in time for the court hearing.

The revised legislation also scraps mandatory penalties of three times the deposit if the deposit is not correctly registered and the ‘prescribed information’ not provided properly. Instead, courts will still be allowed to use their discretion to hand out penalties worth between one and three times the value of an unprotected deposit.

The current legislation had faced a number of challenges within the courts, which have issued varying rulings, some favouring tenants and others favouring landlords.

Steve Harriott, Chief Executive of the Tenancy Deposit Scheme (TDS) stated: “I am pleased the housing minister managed to find the parliamentary time to get these amendments to the legislation through.

“The recent court decisions were causing confusion about tenancy deposit protection regulations. These amendments make it clear that tenancy deposit protection is here to stay.”

Full details of the changes are available in new guidance notes issued by the Tenancy Deposit Scheme which can be seen on www.tds.gb.com and further guidance for members will be issued when the Commencement Order is published.

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