The new date for the Tenancy Deposit Protection has been announced as April 6th 2007. This key part of the Housing Act 2004 was originally planned for implementation on 1st October of 2006. Tenancy Deposit Protection applies to all assured shorthold tenancies in England and Wales, where a deposit is taken on or after the 6th April 2007.

Dominic Mitchell, Commercial Property solicitor at Coles Miller’s Poole branch agrees that this delay will be beneficial for both landlords and tenants. “The implementation of Tenancy Deposit Protection (TDP) has been delayed so that further consultations can be carried out with landlords, tenants and letting agents,” says Mr Mitchell. “The government ran a voluntary pilot scheme for several years from 2000, but abandoned it in 2003 due to a lack of support from landlords. This extra time will prevent the same from happening again by promoting the positive message about the TDP to landlords and tenants, especially those who are new to the renting experience.”

Before a tenant can rent a property they pay a deposit to the landlord to cover any potential damage to the property, unpaid rent, missing or damaged items and cleaning. “The TDP is designed to protect tenants who have difficulty recovering their deposits and to help resolve disputes between landlords and tenants by introducing a third party,” continues Mr Mitchell. “Any deposit taken by a landlord must be placed in an authorized tenancy deposit scheme within 14 days.”

There are two types of scheme that landlords can choose from; the custodial scheme, known as the Deposit Protection Service (DPS) or the insurance backed scheme run by the Tenancy Deposit Scheme (TDS) or and alternative insurance based company known as Tenancy Deposit Solutions Ltd (TDSL) which is a partnership between the National Landlords Association and Hamilton Fraser Insurance.

“If landlords do not sign up to one of the two schemes they will face a penalty of up to 3 times the amount of the deposit. There are ways that landlords may try to dodge the scheme that tenants need to look out for, for example they may not charge a deposit but insist on there being a guarantor to foot the bill if the tenants damage the property or they may ask for two months rent in advance instead of a deposit.”

Mr Mitchell does offer tenants some advice for when they move into a rented property. “The first thing tenants must ensure is that their tenancy agreement is precise about what the deposit covers and when it will be returned. This will prepare and protect you in the event of a dispute at the end of your lease. When you move into your property make sure there is a detailed inventory of the property’s contents and condition and that both you and your landlord sign it and keep a copy. If you want to be really sure, take pictures of your new home when you move in. If you do cause any damage to the property or the items be sure to inform your landlord in writing and agree with your landlord before you repair damages or replace damaged items. The most important piece of advice would be to keep a record of everything, including your rent payments, if you replace any damaged property etc.”

If you require further information about Tenancy Deposit Protection please contact Dominic Mitchell at Coles Miller on 01202 675868 or email dmitchell@coles-miller.co.uk.