Deposit Protection

Landlords in England and Wales must place any tenancy deposit in one of three government-approved schemes within 30 days: the Deposit Protection Service (DPS), MyDeposits, or the Tenancy Deposit Scheme (TDS). Prescribed information about the scheme must be given to the tenant within the same 30-day period. Failure to protect the deposit means the landlord cannot validly serve a Section 21 notice and may be ordered by a court to pay the tenant between one and three times the deposit amount as a penalty. When the tenancy ends, disputes over deposit deductions are resolved through the scheme's free alternative dispute resolution service. In Scotland, all deposits must be protected with SafeDeposits Scotland, Letting Protection Service Scotland, or My|deposits Scotland within 30 working days.

What it means in practice. Protection is not the same as prescribed information. The landlord must do both, and within the same 30-day window: place the money in a scheme, and give you the scheme details, the deposit amount, the address, and how to get the money back at the end. Two of the three schemes offer a custodial option, where the scheme holds the cash, and an insured option, where the landlord keeps it and pays a premium. The deposit itself is capped by the Tenant Fees Act 2019 at five weeks' rent where the annual rent is under £50,000, and six weeks' rent above that.

A worked example. Leo pays a £900 deposit in March. His landlord banks it and forgets about it. When Leo moves out in November the landlord proposes to keep £400 for cleaning. Leo checks all three scheme databases, finds no record, and points out in writing that the deposit was never protected. Because there is no scheme, there is no free adjudication service — so Leo brings a county court claim for return of the deposit plus the statutory penalty of between one and three times the amount. The landlord settles rather than face a court finding.

Common pitfalls. Tenants often assume the scheme decides who is right about a dispute automatically; in fact you must actively raise a dispute with the scheme before the deposit is released, and the adjudicator decides on the documents alone. Without a signed inventory and dated photographs at both check-in and check-out, most deduction disputes come down to who has better evidence. Landlords, meanwhile, wrongly believe that late protection cures the breach — protecting the deposit after the 30 days has passed does not remove the tenant's right to claim the penalty.

How it relates to other terms. Deposit protection failures used to invalidate a Section 21 notice, which was abolished on 1 May 2026, but the penalty claim survives in its own right and can be brought up to six years after the breach. The wider concept is covered under tenancy deposit, and the cap on what can be charged comes from the Tenant Fees Act 2019. Deposit disputes often overlap with disrepair, since a landlord cannot charge you for a problem they were obliged to fix.

What to do next. Read our guide to rental deposits to check yours was protected properly, and getting your deposit back before you move out. If the landlord proposes deductions you dispute, use tenancy deposit disputes and raise it with the scheme rather than accepting the offer.