What costs can be deducted from a tenant’s deposit?

The Tenancy Deposit Protection scheme provides some financial security to landlords.

The Tenancy Deposit Protection scheme allows landlords to take a deposit from tenants when they first move into a property and store it securely.

This deposit then acts as a security measure to deter tenants from causing damage to a property and provide landlords with some financial security.

The rules surrounding tenancy deposits are regulated by the Housing Act 2004, and it’s important that landlords familiarise themselves with the correct process for taking a deposit and what costs it can and cannot be used against.

What costs can you deduct from a tenant’s deposit?

The most common costs that a deposit can be used to recover are unpaid bills and damage caused either deliberately or by tenants neglecting to care for and maintain the property. These costs include:

• Unpaid rent.
• Unpaid bills.
• Stolen or missing inventory.
• Damage to the property or inventory.
• Items left behind at the property.
• Cleaning expenses.

What costs cannot be deducted from a tenant’s deposit?

The tenant cannot be charged for any maintenance or repairs caused by general wear and tear. Neither can they be charged for fixing anything that it is the landlord’s responsibility to maintain according to the Landlord and Tenant Act 2004. This includes:

• Maintenance and repair of the property’s structure.
• Maintenance and repair of utility systems (eg. heating and boiler).

Since legislation came into place on the 6^th of April 2007, it has been illegal for a landlord to take a tenancy deposit without having it paid into an approved deposit protection scheme.

When a tenancy ends, the landlord must provide tenants with details of any deductions that they wish to make from the deposit.

Of course, sometimes if a tenant has not paid rent for several months, then a tenancy deposit will not cover the landlord’s losses.