Remember changes to Deposit Protection legislation
by Sarah Ashcroft
Landlords should make sure that they understand their legal position when it comes to Tenancy Deposit Protection
In April of last year, changes were made to the system because the government introduced the Localism Bill. It means that the penalties for failure to comply with the legislation have altered and property owners can now be liable for 100 per cent of the deposit and up to three times the amount on top of this.
Deposits also have to be protected within 30 days of being received, while tenants have to be given all of the necessary legal papers in this time.
There are three schemes that landlords can use, the Deposit Protection Service
or the Tenancy Deposit Scheme
. While the rules regarding two of them remained unchanged in 2012, TDS did alter its requirements.
The scheme now requires the landlord or agent to update the deposit record when a tenancy becomes a Statutory Periodic Tenancy - this is when a fixed tenancy agreement
comes to an end and neither party does anything about this.
While the terms and conditions do not change, the tenancy rolls over onto a month-by-month system. If landlords fail to adhere to the new regulation, then the deposit is no longer protected and this could result in the tenant being paid 400 per cent of the deposit to settle the dispute.
Landlords are encouraged to check the terms of the protection scheme that they are involved in, as it is better to be safe than sorry considering the financial implications of getting it wrong.
Property owners hoping to rent out their house should also conduct a thorough inventory
. Using terms such as 'good' and 'fair' will not be helpful if a dispute arises and so people should look to be as detailed as possible in their descriptions.
This is why phrases such as 'unmarked', 'as new' and 'in perfect working order' are much more useful when it to comes to calculating damage.
Published on: January 17, 2013
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