What is TDS?

Many tenants in the private sector give their landlords a deposit against possible non- payment of rent or damage to property.When a tenancy comes to an end, there is usually no disagreement about the return of the deposit. But sometimes there is, and this can cause much hardship and inconvenience to both landlord and tenant.

The Housing Act 2004 (Chapter 4, sections 212-5; & Schedule 10) made provision for both the protection of tenancy deposits and the resolution of disputes over their return.The Dispute Service has been awarded a contract by the Government to run one such scheme: The Tenancy Deposit Scheme (TDS).

The legislation came into effect on 6 April 2007. After that date all deposits taken for Assured Shorthold Tenancies must be protected.

What are the legislative requirements?

  • Any landlord or agent who takes a deposit from a tenant for an Assured Shorthold Tenancy must safeguard it in an approved tenancy deposit scheme...
  • ...and the tenant must be told which one.
  • The deposit must be in money.
  • Landlords in breach of these provisions will not be able to issue S 21 notices, and may have to pay the tenant compensation of three times the deposit.
  • The landlord/agent must submit the deposit to the operators of their scheme when requested to do so.
  • Each scheme must have procedures for resolving disputes without going to court.
  • There are strict time limits for the return of the deposit if there is no dispute.
  • The Act allows for both custodial and insured schemes. Custodial schemes are where the deposit is lodged with an independent third party i.e. outside the control of the landlord. Insured schemes allow the landlord/agent to retain control of the deposit as long as they are subject to suitable insurance arrangements.
  • Secondary legislation fills out the detail, including time limits for dealing with disputes.?

The Tenancy Deposit Scheme (TDS) has been developed to ensure that the deposits are protected and that disputes about their return are resolved swiftly, inexpensively and impartially.

Under TDS:

  • Deposits will be protected during the tenancy.
  • Where there is no dispute at the end of the tenancy, deposits will be returned promptly.
  • Where there is a dispute about the return of the deposit it will be dealt with fairly by the Independent Case Examiner (ICE).
  • The ICE will make his decision quickly, and the deposit will be paid out without unnecessary delay.

RSS Feed Latest TDS News

Property industry unites to launch ‘best practice’ Code for the Private Rented Sector

Seventeen leading property organisations have today launched a new Code to drive up standards and quality in the Private Rented Sector (PRS) in response to too many privately rented homes in the UK failing to meet the ‘English Housing Survey’ standards.

12th September 2014

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