With the new financial year comes a whole host of new regimes for landlords, many of which are associated with penalties and fines. One to watch out for is the new tenant deposit regime which came into force last Friday.
What is the current situation?
As most landlords will know most types of tenant deposits, excluding some special types of let, must be kept safe in a government approved tenancy deposit scheme. The government has approved three different alternatives that landlords may choose from and all are free to use. This means that landlords are able to keep their tenants deposits safe, secure and free from interference with other finances – for tenants, this means deposits get lost a lot less often.
What has changed?
From Friday the law states that tenant deposits must be placed into a tenancy deposit scheme within thirty days as opposed to the previous fourteen day limit. This may sound advantageous to landlords but it is not quite that simple: many landlords who were questioned on the offence were able to blame ‘administrative errors’ for their failure to comply. Under the more generous regime the penalties will be considerably more serious and rather than a grace period being offered, any charge is absolute.
What action should I take?
If you take on any new tenants from now on, you need to ensure you place any deposits in the appropriate scheme within thirty days. This is standard practice for most landlords but beware – if you fail to comply you may be penalised heavily. You should also ensure you have a good landlord insurance policy in case of any legal disputes.
For the prudent landlord these new changes shouldn’t be a problem but it is something to be aware of. Make sure you deposit your tenant’s deposits quickly and beware of the penalties if you fail to meet the required time limit.