From the 6th of April 2006, all deposits taken on Assured Short Hold Tenancy Agreement with a annual maximum of £25,000 taken by Landlord in England and Wales have to be protected by an authorised tenancy deposit scheme,

A (AST) Assured Short Hold Tenancy is the usual tenancy agreement made between Landlords and Tenants.

How does the Tenancy Deposit Scheme Work..?

Landlords can choose between two types of scheme, a custodial scheme or two insurance based schemes.

Custodial Scheme

* The Tenant pays the deposit to the Landlord

* The Landlord pays the deposit into the scheme with 14 days of receipt

* Within 14 days of receiving the deposit, the Landlord must give the tenants the information listed as pr the prescribed information of the scheme.

* At the end of the tenancy, the Landlord and tenant agree how the deposit should be divided. The scheme will pay out in accordance with this agreement.

* If there is a dispute, the scheme will repay the undisputed amount with interest to the person that is entitled to it, and hold the disputed amount until the dispute is resolved.

* The interest earned by the deposits in the scheme will be used to pay for the running of the scheme. A proportion of the interest earned will be added to the deposit amount when it is returned to the person entitled to it.

Insurance Based Scheme

* The Tenant pays the deposit to the Landlord *The Landlord retains the deposit, but pays a fee to the scheme. The scheme insures the deposit against the Landlord unlawfully retaining the deposit at the end of the tenancy.

* Within 14 days of receiving the deposit, the Landlord must give the tenants the information listed as per the prescribed information of the scheme.

* At the end of the tenancy, the Landlord pays the tenant any part of the deposit that isn’t in dispute.

* If there is a dispute over the repayment of part of the deposit, the Landlord must hand over the disputed amount to the scheme for safe keeping until the dispute is resolved.

* If for any reason the Landlord fails to comply, the scheme will ensure the return of such part if the deposit to the tenant as he is entitled to, and recover any part that it has to pay from the Landlord.

Who Runs the Tenancy deposit scheme’s

The Deposit Protection Service (DPS)

DPS is the only custodial deposit protection scheme. It is free to use by Landlords. The service is funded entirely from the interest earned from the deposit’s the scheme holds. Landlord are able to register and make transactions on line. Paper forms will also be available should internet access not be possible. The scheme is supported by a dedicated call centre.

For more information

By phone call 0870 707 1 708

Online at www.depositprotection.com

Tenancy Deposit Solutions Ltd

TDSL is an insurance-based scheme sponsored by the National Landlords Association and administered by Hamilton Fraser Insurance Services. It is open to all landlords and letting agents, provided the deposit is held by a landlord residing, or an agent established, in the UK. A fee is payable to insure the scheme against any misappropriation to the deposit. The scheme is supported by a dedicated call centre and an independent dispute resolution service.

For more information,

By Phone call 0871 703 0552

Online at www.mydeposits.co.uk