Landlords still failing to protect tenancy deposits
The new Deregulation Act means that tenancy deposits received before 6th April 2007 where the tenancy was renewed on a periodic basis after that date are now included within deposit protection law. Landlords now have only until 23rd June this year to register these deposits in a government approved scheme. Those who fail to comply will face a penalty of between one and three times the value of the deposit and restrictions on regaining possession of their property.
This new Deregulation Act has clarified the law – a clarification which was long overdue. There have been a number of court rulings over which deposits must be protected and about the circumstances when documents containing prescribed information must be given to tenants.
It is already a requirement that deposits are protected however the act now requires that deposits must be protected by 23rd June if they were received before 6th April 2007 and if the tenancy was renewed periodically after that date. If landlords don’t give their tenant’s full written information about their deposit protection they could still be fined even if the deposit is protected.
If a tenancy renewed on a periodic basis before 6th April 2007 deposit protection is not compulsory however the landlord will still be prevented from regaining possession using the standard section 21 notice unless they protect or return the money.
Lynne McCaffrey, Head of Property comments:
“Media commentators are noting that there’s evidence that some landlords have only just become aware of the need to protect tenants deposits and so have already failed to comply with deposit protection law.
“As a leading firm of property solicitors with many buy-to-let conveyancing clients we always aim to share information on the wide range of landlord responsibilities and the breadth of legal issues faced by landlords in a timely manner to give a broader service to our clients.”
Content correct at time of publication