Tenancy Deposit Protection changes set to take effect April 6th

by Daniel Jones

A number of important changes to the Tenancy Deposit Protection scheme in England & Wales are set to take effect from April 6th. Landlords are being urged to pay close attention to the reforms to ensure that they do not fall foul of the new system.

The main change is that the time limit for protecting a deposit and providing the required information to the tenant will extend to 30 days from 14 days from the date of receipt.

If a landlord does not comply with the legislation, the court will have discretion as to the amount of the penalty payment. This could be between one and three times the amount of the deposit. The penalty will still have to be paid even if the landlord complies with the scheme requirements before the hearing of the tenant's claim.

The tenant will be able to apply to the Court for a penalty payment even if the tenancy has ended.

A landlord who fails to comply with the legislation within the given time period will lose the right to serve a Section 21 Notice, unless the deposit has been returned or if the tenant's claim has been decided, withdrawn or settled.

Chris Norris, policy manager at the National Landlords Association, says that as long as landlords are already complying with the rules, there is nothing to worry about.

What the changes will do is close a few "unintended consequences" of the original scheme, he explains, citing recent legal challenges that enabled landlords to protect very late and avoid sanctions.

"Those loopholes have been closed, so if landlords fail to comply, they need to be very aware that they can be taken to court, they can be fined quite considerably and they will receive those penalties," says Mr Norris.

"Landlords need to know that they need to comply and they need to protect the deposit, give the prescribed information and they need to do that within 30 days. If they have done that they needn't be concerned about the new regulations at all," he adds.

Landlords can easily give the prescribed information to their tenants regarding their deposit with Lawpack's solicitor-approved Tenancy Deposit Protection (Section 213 Notice) template.

  • Landlord and Tenancy News from Lawpack: Give tenants the right information concerning their tenancy deposit protection with our Section 213 Notice.

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Published on: March 27, 2012

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