The Tenant Fees Act has brought in a number of changes, including limits on Tenancy deposits. As a Landlord how does this affect me?
The Tenant Fees Act became effective from 1st June 2019, imposing a number of restrictions upon all new Housing Act tenancies signed from that date onwards. It defined precisely the costs chargeable to tenants relating to a tenancy, and as part of that restricted the value of a deposit that could be taken from tenants in relation to the tenancy.
Simply the Tenancy Deposit Cap defines the maximum deposit that can be taken for a tenancy as the equivalent of 5 weeks rent (where the rent is less than £50,000 per annum) and up to 6 weeks rent equivalent where the rent is more than £50,000 per annum.
Therefore any new tenancy commencing and signed after 1st June 2019, MUST only have a deposit at that value, with any additional taken being in breach of the legislation and considered a 'Prohibited' Payment under the Act, and thus must be returned to the tenant.
An existing tenancy (signed before 1st June) can continue to hold a deposit greater than the capped limits, either until its termination OR until 31st May 2020 (whichever is earlier).
The deposit schemes have launched useful guidelines for Landlords on the tenancy deposit cap, and how this can be managed and amended through their schemes.
Links to these guidelines are provided here for ease:
For My Deposits - click here
For TDS - click here
Your ludlowthompson representative will be happy to help with any queries you may have regarding your deposit, registration requirements and re-registration due to tenancy changes.
12th June 2019
DISCLAIMER: Neither ludlowthompson nor their ‘experts’ take any responsibility for any action or loss incurred by readers of these pages. The reader acts on advice at their own risk. Answers to questions are not exhaustive. Financial advice must always be sought from a professional financial adviser
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