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What Happens to My Deposit When I Rent?

Katie Cullen
Written by Katie Cullen
18th January 2017 (Last updated on Tuesday 18th September 2018)

APwC report from July 2015 concluded that Generation Rent is set to increase. Rising house prices and limited supply means more than half of the 20-39 age group will be privately renting by 2025.

For younger generations, privately renting is to become the norm. Home ownership will only be a possibility late into their adult lives, unless there is a huge increase in affordable housing supply – an unlikely prospect to happen fast enough between now and 2025.

So, as more people will be renting, knowing your rights when it comes to paying a deposit and getting it back is important. This week, comparemymove.com will outline what exactly a deposit is, who keeps it, how to ensure you get it back, and what to do in the event of a dispute between you and your landlord.

This article will cover the following points

What Is a Deposit? Who Is Responsible for Your Deposit? Why You Might Not Get Your Deposit Back Is Your Deposit Protected? Disputing Deductions to Your Deposit How to Ensure You Get Your Deposit Back Pay Attention to The Inventory Photograph Everything Don’t Just Clean at The End of The Year When You Move Out Communicate with Your Landlord

What Is a Deposit?

When you rent a property, your landlord will ask you to pay a deposit which is usually the amount of a month’s rent. The deposit is insurance for your landlord in the event of damage to the property or if you don’t pay rent.

The deposit belongs to you and you should get it back when you move out. Your landlord has to return the deposit to you at the end of your tenancy.

Who Is Responsible for Your Deposit?

Even if you have paid your deposit to a letting agent, your landlord is responsible for returning it to you. Keep in mind, they won’t physically have the money on them if you want your deposit back. Remember, you are entitled to know your landlord’s contact details and your letting agent has to supply them to you within 21 days of requesting them.

Why You Might Not Get Your Deposit Back

The only money your landlord can deduct from your deposit is to cover:

  • Damage to the property you’re renting.
  • Any missing items that were in the property and part of inventory.
  • Cleaning costs – hiring a professional cleaning company to go through the property can be costly.
  • Unpaid rent.

Your landlord has to tell you exactly why they are making deductions to your deposit. If they believe you have damaged certain items of furniture, they have to list how much they are deducting for each damaged item.

After the deductions are made, your landlord has to return the rest of your deposit.

Is Your Deposit Protected?

If you are an assured shorthold tenant, your landlord should have your deposit protected in a tenancy deposit protection (TDP) scheme if the property was rented after 6 April 2007.

If you aren’t sure, you are in an assured shorthold tenancy if:

  • The property is your main accommodation
  • You don’t live in the same property as your landlord
  • The tenancy lasts 6 or 12 months

The protection schemes in England and Wales are:

There are separate deposit protection schemes for Scotland and Northern Ireland.

If you feel like you have been unfairly charged, contact the tenancy dispute service.

Disputing Deductions to Your Deposit

The Tenancy Deposit Protection (TDP) scheme offers a free resolution service if you end up disagreeing with your landlord’s decision on how much of your deposit to return. Both you and your landlord have to agree to use this service and you will both be asked to provide evidence. The TDP will try to resolve the dispute and make a decision determining how much you’ll get, although you should get the non-disputed amount back immediately.

Keep in mind, there is limited time for you to raise a dispute with your landlord, so do so as soon as possible.

If you disagree with the TDS and you’re not happy with the decision, you can always take legal action in Small Claims Court. It is relatively cheap as you don’t need a solicitor for Small Claims Court. However, try to resolve the problem before going to court, but if you receive no response and cannot compromise, explain you are doing it as a last resort.

Small Claims Court is cheaper than other legal processes, but there are still fees involved depending on the amount you are suing for:

  • £30 for claims of £300 or less
  • £50 for claims between £300 and £500
  • £70 for claims between £500 and £1000
  • £100 for claims over £1000
  • £150 if you are to lodge an appeal

How to Ensure You Get Your Deposit Back

In most cases, if your landlords has made deductions to your deposit, the issue is that you simply haven’t done enough cleaning.

It’s easy to underestimate how much work goes into properly cleaning your house when you’re moving out. You need to get all the hard-to-reach areas, and the places you didn’t realise needed to be cleaned. You will have to move furniture around, wash windows, and get rid of lots of dust. If you have a family, you can make it a group chore!

Pay Attention to The Inventory

Make sure your inventory is detailed to prevent any disputes over existing damage to the property you’re renting. Note down all the furniture in the property and any marks, stains, scratches and other damage, or any additions or amendments you need.

Photograph Everything

When you move in, take several photos showing the age, condition, and the level of cleanliness of the entire property and its contents. On the inventory, write and label the photos you have taken. Photocopy the signed inventory with your amendments, and return it to the landlord with copies of the photos.

Some tenancy agreements might state that you should leave the property in perfect condition at the end of your tenancy. If the property was not in perfect condition to begin with, you should ask to amend this to “return the property to the state it was in at the beginning of the agreement”.

Don’t Just Clean at The End of The Year

Cleaning costs are one of the main deductions landlords make from deposits. This seems obvious, but family life and work deadlines can often get in the way and mean that dust, grime and general mess builds up over time without you realising. When it comes to the end of the year, cleaning the house properly can feel impossible. If you have children, keep an eye on them as you don’t want any unwanted wall-art by your 5-year-old to take a chunk out of your deposit, as it can often be difficult to get rid of. Try and make it a rule that everyone is responsible for cleaning a specific room in the house every week, to avoid dealing with the build up of grime and dust later on.

It’s easy to get used to how everything looks in your house, and not notice where dirt or mess has built up. Try and look at your house through the eyes of a visitor to spot anything you have missed. If you have a friend who is always very neat and organized, ask them over to see if they can find anything you have missed!

Damp is a costly problem you should deal with before it becomes one and spreads down your walls, covers your possessions, or even causes health problems to you and your family. Most landlords advise you to leave your heating on for an hour a day, or provide a dehumidifier. If you can, open the windows, even during winter, and don’t dry your clothes in unventilated rooms. You can clean areas of damp by using detergent and diluted bleach.

When You Move Out

To avoid having to pay for professional cleaning services, invite your landlord or agent to look at the property after you have cleaned it, but do so before the contract is over. That way, you can agree on what still needs to be done. Once you make the improvements, ask them to come back and sign to state the property is in good condition and you will get your deposit back.

Take lots of close-up photos on leaving the property, as evidence that you have cleaned up properly.

Communicate with Your Landlord

Let your landlord know when something needs fixing as soon as possible, whether you are responsible for the damage or not. By informing them, it shows you’re not trying to hide anything and can help maintain a good relationship between both of you.

At the same time don't attempt to repair anything yourself without written consent from landlord and remember keep copies of every receipt. notes all conversations including times dates but try communicate in writing where possible. If a dispute arises having evidence receipts will help your case.

So, with rising house prices and limited housing supply, the number of people renting seems set to increase, so it's important to know your rights when it comes to your deposit, and follow some practical tips to get the whole thing or at least most of it back. Take photos of the property before and after you move out, clean throughout the year, and keep communicating with your landlord whenever a problem arises.

If your landlord deducts from your deposit and you disagree with the reasons, you can contact the Tenancy Deposit Protection service. The problem may not be resolved, so you can always go to Small Claims court for a small fee.

If you are moving into a rented property soon, comparemymove.com's reputable partners go through a strict verification process, so you can rest assured your moving process will be efficient and quick. You can also end up saving 70% on removal costs.