Daniel Dovar and Michael Walsh give their verdict on the tenancy deposit scheme, one year on
Since April 2007, landlords letting property on an assured shorthold tenancy have had to protect any deposit taken under the tenancy deposit scheme. Many of those tenancies have already or will be coming to an end in the next few months. This article addresses what happens if there is a dispute over the return of the deposit. In April 2007, the scheme imposed by Housing Act 2004, s 212 (HA 2004) came into operation.
COMPLIANCE
The scheme applies to any deposit taken in relation to a new assured shorthold tenancy granted on or after 6 April 2007. It is not applicable to continuation tenancies, ie where the tenant stays in occupation as a statutory periodic tenant (Housing Act 1988 (HA 1988), s 5)). Section 213(8) requires that the deposit taken by the landlord be money and that it is actually transferred to the landlord. This precludes the tenant from giving a credit card impression or writing a cheque that is not banked.
