How do I protect a tenancy deposit?

Put the deposit in a government-approved scheme within 30 days of receiving it, and give your tenant the prescribed information in the same 30 days. Since 1 May 2026 this covers assured tenancies in England.

The rules are in sections 212 to 215 of the Housing Act 2004. On 1 May 2026 the Renters' Rights Act 2025 changed them from covering assured shorthold tenancies to covering assured tenancies, which is now the usual kind of private let. The details below come from GOV.UK and legislation.gov.uk, checked on 16 October 2026.

The three approved schemes

GOV.UK says all three offer both options. With a custodial scheme, the scheme holds the deposit for free. With an insured scheme, you or your letting agent keep the money and pay the scheme to insure it. If there is a dispute at the end, an insured scheme needs the money handed over until it is settled.

How much you can take

The Tenant Fees Act 2019 caps the deposit:

One week's rent is the annual rent divided by 52. For rent of £1,150 a month, the annual rent is £13,800, a week's rent is £265.38 and the most you can take is £1,326.92. A holding deposit to reserve the property is capped at one week's rent, so £265.38 here. You do not protect a holding deposit while it is one, but once it becomes the tenancy deposit, you must.

A deposit must be money. The repossession guidance says it is illegal to take a deposit in any other form, and section 213 says the same. If someone else pays the deposit, such as a parent or a rent deposit scheme, you still protect it.

The prescribed information

Within 30 days of receiving the deposit, you must tell your tenant, and anyone who paid it for them:

• the address of the rented property
• how much deposit they have paid and how it is protected
• the name and contact details of the scheme and its dispute resolution service
• your name and contact details, or your letting agent's
• the name and contact details of any third party who paid the deposit
• why you might keep some or all of it, for example to repair damage
• how to apply to get it back at the end of the tenancy
• what to do if they cannot reach you at the end of the tenancy
• what to do if there is a dispute over how much is returned

The law says this must be given in the prescribed form or a form substantially to the same effect.

What this means for you

If your tenant pays £1,326.92 on 3 November 2026, you have until 2 December 2026 to protect it and send the prescribed information, because the 30 days include the day you receive it. Doing both on the day the money arrives removes the risk.

Getting this wrong has two costs. First, the tenant can go to the county court at any time, including after the tenancy ends. If the court finds the 30-day rules were not met, it must order you to pay the tenant at least the amount of the deposit and up to three times it, within 14 days. While the tenancy is running it must also order you to repay the deposit or pay it into a custodial scheme; after the tenancy has ended it can order you to repay it. Second, for most possession grounds a court will only make a possession order if the deposit is protected and the information given (even if late), or the deposit has been returned, or the tenant's claim about it has been decided, settled or withdrawn. That bar does not apply to grounds 7A or 14 for antisocial behaviour.

Steps to protect a deposit

1. Work out the cap: annual rent divided by 52, times 5 (or 6 if the annual rent is £50,000 or more).
2. Choose a scheme and decide between custodial and insured.
3. Protect the deposit with the scheme within 30 days of receiving it, and keep the confirmation.
4. Give the prescribed information to the tenant, and to anyone who paid for them, within the same 30 days. Keep proof of when and how you gave it.
5. At the end of the tenancy, agree any deductions and return the deposit within 10 days of agreeing the amount.
6. If you cannot agree, use the scheme's free dispute resolution service.

Your deposit details sit alongside your gas, electrical and EPC records on the landlord compliance checklist. If you also need to know whether Making Tax Digital applies to your rent, the free MTD check takes a few minutes, and the landlord section has more guides.