Taking a tenancy deposit isn’t a legal requirement, but it is a smart choice for many landlords as it provides a way to pay for damages to the property during the tenancy.
However, if a landlord does choose to take a deposit in money (rather than a valuable item), they must comply with legal obligations around the deposit. Not doing so could have severe consequences for the landlord’s finances and reputation. It can even mean you can’t evict a tenant.
Below, we’ll discuss the legal requirements for protecting tenancy deposits and how to evict a tenant if the deposit wasn’t protected.
What landlords must do with deposits
Most tenancies in England are assured shorthold tenancies (ASTs), so we’ll focus on this type of tenancy.
With an AST, landlords are legally required to use a tenancy deposit protection scheme (TDP scheme). This law was put into place to protect tenants from landlords who kept part or all of their deposits without good reason.
If your property is an HMO (house in multiple occupancy), you still have to use a TDP scheme. In this case, all tenants’ deposits will be protected separately. Your tenancy deposit protection scheme can help you do this correctly.
Types of schemes
In England and Wales, you have a choice of three deposit protection schemes to choose from. These are:
There are two ways to use the scheme. You can:
- Use an ‘insured’ scheme, where you retain the deposit and pay the scheme to insure that amount.
- Use a ‘custodial’ scheme, where the scheme retains the deposit money.
Time requirements
Timing matters here. You need to protect the deposit in a TDP scheme within 30 days of receiving it from the tenant.
Information requirements
There’s one other main requirement around deposits. You need to provide the tenant with information about the scheme you’ve used. See the full details of information required on the government’s website. The information you give should include:
- The contact details of the tenancy deposit protection scheme and how the tenant can resolve disputes with you using it.
- Reasons why you might retain part of all of the deposit.
What tenants can do if deposits aren’t protected
If you haven’t protected a deposit within the appropriate timeframe and provided the required information, tenants can take you to court. This could be very costly, as you might be required to pay up to three times the amount of the deposit.
Furthermore, not protecting a deposit can prevent you from evicting a tenant.
Types of evictions
When you’re considering how to evict a tenant if their deposit wasn’t protected, you’ll need to know what type of eviction you’re performing.
At the moment, there are two main types of evictions in England for tenants with an assured shorthold tenancy (AST). Which eviction process you choose depends on whether you have grounds for eviction – in other words, whether the tenant has done something wrong.
To start an eviction, you’ll serve a legal notice of eviction. There are two options here – Section 21 and Section 8 notices.
- Section 21 evictions – these are no-fault evictions, meaning that the tenant has not done anything wrong. You might use this if their tenancy is over and it’s time for a new tenant to come in. Note that no-fault evictions are set to be eliminated in England sometime in 2025, so this option may not always be available.
- Section 8 evictions – these are evictions in which the tenant has breached their tenancy agreement. One example of grounds for a Section 8 eviction is persistently not paying rent.
How to evict a tenant if the deposit was not protected
If you haven’t protected a deposit and provided the required information, evictions become more difficult. What happens depends on the type of eviction.
Section 21 evictions
Simply put, you cannot evict a tenant using a Section 21 notice if the deposit wasn’t protected.
Your best option here is to return the deposit before starting the eviction process. If the tenant accepts the deposit back from you, you can then serve the Section 21 notice.
If the tenant will not accept the deposit back from you, you could enter the deposit into a TDP scheme late. But judges will not look kindly on this. It may be wise to seek legal advice from an experienced landlord and tenant solicitor about the best approach to take.
If you did protect the deposit but didn’t give the tenant the required information about the TDP scheme, give them the information before beginning the eviction process.
Section 8 evictions
You can still proceed with a Section 8 eviction if the deposit wasn’t protected. However, ensure that you are making the strongest legal case possible about your grounds for possession and the tenant’s breach of the tenancy agreement. Not having protected the deposit will work against you in court, so ensure that you have good legal counsel to support you.
Legal support from experienced family law solicitors
Evictions can be tricky at the best of times. They’re even tougher when you’re trying to figure out how to evict a tenant if the deposit wasn’t protected. That’s why you need specialist landlord and tenant solicitors who know how to achieve the best result for you as a landlord.
The information in this blog post is provided for informational purposes only. To get more guidance on your own unique situation, why not try a no-cost, no-obligation 30-minute consultation with Osbourne Pinner Solicitors? We’re specialists in tenant evictions and other landlord-tenant disputes.
To sign up for your free consultation, just complete our form below, call 0203 983 5080 or send us a message at [email protected].
