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Welcome to Day 3 of "Lifecycle of a Deposit" Week, powered by TDS, with content supplied by the TDS team. Over the rest of this week, we are charting the lifecycle of a tenant's deposit - from pre-tenancy to end of tenancy.Although deposit protection legislation has been in place in England and Wales for over a decade, some landlords and agents are still unclear about what their responsibilities are. In the third instalment of Property Tribes’ series of articles on deposit protection, Tenancy Deposit Scheme’s (TDS) Director of Customer Services, John King provides a step-by-step guide to getting it right.Yesterday, we covered landlords’ and agents’ pre-tenancy responsibilities to minimise deposit disputes, but now that your tenant is about to move in, how do you correctly protect their deposit?
1. Check-in/inventory report
Following the advice in yesterday’s article, you should supply your tenants with a check-in/inventory report when they initially move into the property.Best practice is to get your tenant to sign and return the report to demonstrate that they agree with the contents, condition and level of cleanliness the property is described as being in.
2. Register the deposit
Once your tenant has paid their deposit, you must register it with a Government-approved deposit protection scheme such as TDS, within 30 days of receipt of the deposit.Some people mistakenly think that they have 30 working days, or 30 days from the start of the tenancy, but it is actually 30 days from receiving the deposit. If you don’t meet the deadline, tenants can make a claim through the courts for the full deposit amount in addition to between one and three times the value of the deposit in compensation.Deposits can be lodged with TDS online in either the Custodial or Insured scheme.Under the Custodial scheme, the full deposit is transferred to TDS where it is held until a repayment request is made when a tenancy finishes and is free for landlords and agents to use.The Insured scheme allows landlords or agents to hold the deposit in return for a small fee, for TDS to protect the deposit value.Online registration for both schemes is straightforward, but should you need help, TDS has a dedicated operations team of customer support staff on hand to help.
3. Provide the necessary documentation
After the deposit has been lodged with TDS, you will receive a confirmation certificate which should be printed and shared with tenants. You should also provide them with copies of the Prescribed Information and Scheme Leaflet documents.As is best practice with documentation during tenancies, you should ask your tenants to sign and return copies to demonstrate that they’ve read and understood their contents.The process of registering deposits is simple, but it’s vital to get it right.Failing to do so can land agents and landlords with large fines and limit your ability to serve a Section 21 notice should you need to terminate a tenancy.If you are renting a property, you should read-up on your responsibilities related to tenancy deposits to make sure that you stay on the right side of the law.We publish a wealth of information on our website in blogs, guides, and case studies and organisations such as the Association of Residential Letting Agents (ALRA) and the Residential Landlords Association (RLA)** provide further practical advice for landlords and agents.Forums like Property Tribes also offer valuable support and an information network for landlords and agents to share information and tips. ** Get 25% off your RLA membership through Property Tribes. Claim your 25% discount >>> here._______________________________________Tune in daily for fresh content about how to protect a tenant's deposit correctly at the start of the tenancy, right through to the return of the deposit at the end of the tenancy.Content review:Monday - Launch of "Lifecycle of a Deposit" Week!Tuesday - Pre-tenancy deposit responsibility - tipsThursday - How changes to a tenancy affect the depositFriday - Managing the deposit at the end of the tenancySaturday - How to think like an Adjudicator to solve disputesThank you to TDS for supporting landlord education and Property Tribes.If you would like to take advantage of the off-line training offered by TDS, you can find a list of workshops >>> here.SEE ALSO - New "How To Rent" Guide published (June 2018 version)UP NEXT - Tenancy Deposit Scheme: Custodial or insured?DON'T MISS - Importance of the inventory in TDPNOW WATCH:
Vanessa Warwick Landlord and Co-Founder of PropertyTribes.com **If you have got value from Property Tribes, find out how you can support it in remaining a free to use community resource**