Tenancy Deposit Schemes
What is a tenancy deposit?
A tenancy deposit is a sum of money which a landlord may ask a tenant to pay at the
start of a tenancy, and which must not amount to more than two months rent. The
landlord holds the money as security against the tenant not meeting their obligations
in connection with a tenancy or occupancy arrangement. The tenancy agreement
should set out the circumstances in which the deposit may be withheld by the
landlord at the end of the tenancy. For example, the landlord may decide to keep
some or all of a deposit if it is needed to pay for:
damage the tenant has caused to the property
cleaning bills if the property has been left in poor condition
bills that are left unpaid, for example fuel or telephone bills
any unpaid rent.
What is a tenancy deposit scheme?
A tenancy deposit scheme is an independent third party scheme which has been
approved by the Scottish Government to hold and protect tenant’s deposits until they
need to be repaid at the end of the tenancy.
Why are the schemes being introduced?
The schemes are being introduced in response to concerns about the large sums of
money that are unfairly withheld from tenants deposits by some landlords and letting
agents at the end of a tenancy.
Please be advised that it is the Scottish Government who are overseeing the
Tenancy Deposit Scheme, Scottish Borders Council do not have any input into the
schemes and are not able to show preference to any particular scheme. For further
information please see the Scottish Government website.
What are the benefits of having a scheme?
tenancy deposits will be protected by an independent third party - this will
prevent deposit from being unfairly held by landlords or letting agents
schemes will be free - there will be no charge for tenants, landlords or letting
agents to join a scheme
quick repayment of deposits - where a landlord and tenant agree about the
return of the deposit the scheme administrator must return the deposit within 5
working days
Page 1 of 3
free access to an independent dispute resolution service - every approved
scheme will provide a free service to resolve disagreements over the return of
deposits as an alternative to legal action through the courts
improved professionalism of the private rented sector - the introduction of a
scheme will encourage consistent standards in relation to management of
deposits and improve the image of the sector.
When will tenancy deposit schemes be available?
Tenancy deposits schemes will start operating on Monday 2 July 2012. The three
schemes that have been approved by the Scottish Ministers are:
The Letting Protection Service Scotland
Telephone: 0844 472 6666
SafeDeposits Scotland
Telephone: 0141 553 4677
MyDeposits Scotland
Telephone: 0207 840 8917
Which landlords must comply with a scheme?
Most landlords who let privately rented property are required to register with the local
authority in which the property is situated. Every landlord who receives a deposit,
and who is required to register in the local authority register of landlords (in
accordance with the Antisocial Behaviour etc. (Scotland) Act 2004) must comply with
the Tenancy Deposit Schemes (Scotland) Regulations 2011.
This includes landlords of assured and short assured tenancies, university
accommodation, as well as various other types of occupancy arrangement.
For further information of Landlord Registration, please visit the Scottish Government
website or contact the Housing Strategy Team at Scottish Borders Council.
What does the introduction of a tenancy deposit scheme mean for
landlords?
The regulations require that a landlord must pay deposits into an approved scheme
and ensure that the money is held by an approved scheme for the duration of the
tenancy. Evidence of registration with the relevant local authority must be provided
when the deposit is paid over.
The tenant must also be provided with specific information about the tenancy, the
deposit and the scheme that will be protecting it.
Page 2 of 3
What happens if a landlord doesn’t comply with the tenancy deposit
legislation?
A tenant can take a landlord who doesn’t protect the deposit with a scheme or
provide the required information within the specified timescales to court. Where
satisfied that a landlord has not complied, a sheriff can order the landlord to pay the
tenant up to three times the deposit. Advice agencies and the Housing Strategy
Team will be able to offer guidance and support to a tenant who wishes to take
action against their landlord over a tenancy deposit.
When must deposits be protected and information provided to tenants?
This will vary, depending on when the deposit was received:
Date deposit received Duty to comply
1 Deposit received on or after 2 July 2012 and
before 2 October 2012
By 13 November 2012
2 Deposit received on or after 7 March 2011 and
before 2 July 2012
By 13 November 2012
3 Deposit received on or after 2 October 2012 Within 30 working days
of the beginning of the
tenancy
4 Any deposit received prior to 7 March 2011
Unless
the tenancy is renewed, either by express
agreement or on tacit relocation, on or after 2
October 2012 and before 2 April 2013
By 15 May 2013
Within 30 working days
of renewal
What happens if a landlord uses a letting agent?
A landlord can still use an agent to act on their behalf to manage a tenancy, as
happens now. However, the duties in relation to tenancy deposits ultimately apply to
the landlord, as the person requiring the deposit.
This means that any sanctions imposed by a court will apply to the landlord. It will be
in the interests of any landlord who employs a letting agent to act on their behalf to
satisfy themselves that they act in accordance with the Regulations.
The landlord may take action against the agent through the court if there has been a
breach of contract, as is the case now.
Further information about tenancy deposit schemes and free information sessions
can be found on the Scottish Government website.
Page 3 of 3
