An Update from The Deposit Protection Service

Welcome to the fourth update from The Deposit Protection Service. Over 8000 Landlords and Letting Agents have now registered to become part of The Deposit Protection Service, and hundreds more are joining each day. Thank you to all of those who visited our stand at the Landlord Show at Olympia last Thursday - we answered queries from over 500 landlords during the event, and many of you were able to pre-register directly on our stand on the day.

Once again, we've repeated the 'What Happens Next'? section of this email for the benefit of new registrants.

Most Common Enquiries

What happens if the tenant has a tenancy agreement that was taken out before 6 April 2007 but continues occupying the property after the end of that tenancy?

If the tenant decides to remain in an existing rented property beyond the initial fixed term of 6 months, how the deposit is treated will depend on how the tenancy is continued:

• For a periodic tenancy - i.e. the tenancy continues with no new agreement - TDP will not apply, as no new AST will have been created
• For a replacement/renewal tenancy (which can be notified either in writing by the landlord or via a memorandum of extension) between the same landlord, tenant and property and where there is no change to the amount of the deposit held; tenancy deposit protection will not apply to an initial deposit taken prior to 6 April

Does the Tenancy Deposit legislation apply to agricultural and charity lets?

No - these are not classed as ASTs, so do not need to comply with the new legislation.

How and when will interest generated on the deposit be repaid?

The Deposit Protection Service is completely free for landlords and letting agents to use. The service works through landlords and letting agents submitting their deposits to be protected during the course of the tenancy.

At the end of a tenancy period, when the deposit is reclaimed, it will be paid back to whoever is entitled to it - landlord or tenant - along with a portion of the interest generated. Under the current legislation, interest will be paid on all deposits at Bank of England base rate minus 2.32%. If the landlord and tenant are both entitled to a portion of the deposit, they will receive the relevant portion of the interest. The remainder of the interest is used to fund the scheme.

When does the 14 days for submission of the deposit start?

The legislation requires that landlords or letting agents holding deposits must protect those deposits within 14 days of receiving the deposit from the tenant. The 14 days starts from when the deposit is physically received by either the landlord or letting agent.

When will the scheme rules be available?

Scheme rules will be available from April 4th.

What happens next?

On the 4th April, all landlords and letting agents who have pre-registered will receive an email notifying them that The Deposit Protection Service website and contact centre are both open to take registrations. This email will give you instructions as to how to access your account online.

Fast, Free Secure

Step 1 - Completing your registration

Your pre-registration details will have been populated into Step 1 of the simple, three-step process to submitting your tenants' deposits. You will have the opportunity to check that the details are still correct and to set a password to give access to your account.

As soon as all your details have been entered, we will send you an email which you will need to acknowledge in order to finalise your registration.

Step 2 - Your Tenancy details

Simply complete the details of the property and the tenants. We have made this as easy as possible by only asking for essential information to enable us to protect the deposit and ensure you are legally compliant.

Step 3 - Submitting your deposits

Paying the deposit to The DPS could not be simpler. Internet users can pay securely online using a debit card, alternatively, both online and postal users of the service can attach a cheque and post it to The DPS.

Once you have completed the submission process, and your payment has cleared, you will be sent confirmation that your tenants' deposits are protected. Tenants will also be notified that their money has been passed to the appropriate third party.

Step 4 - Reclaiming Deposits

At the end of the tenancy, you'll be embarking on Step 4 of the process - reclaiming the deposit. It's easy to do: both landlord and tenant agree on how the deposit is to be repaid, and jointly notify The Deposit Protection Service, either online, or by post. The deposit will then be repaid within 10 calendar days. No money can be repaid without the agreement of both parties. In the event of a dispute, The Deposit Protection Service has 28 days from receipt of evidence from both parties to adjudicate.

Events

DPS representatives will be present to answer your questions at the following events:

Information

For general information on this new legislation, please click here.

Once again, we appreciate you registering with The DPS and look forward to serving your deposit protection needs.

Best regards
The DPS Team

Note: This email was sent from a notification-only email address that cannot accept incoming email. Please do not reply to this message.

www.depositprotection.com

The Deposit Protection Service is a trading name of Computershare Investor Services plc.