Deposit Protection Schemes

Deposit Protection Schemes

Tenancy Deposit Protection (TDP) schemes guarantee that tenants will get their deposit back at the end of the tenancy. However they must meet the terms of the tenancy agreement and must not damage the property.

Landlord obligations

Landlords must protect their tenants’ deposits if they have let the property on an assured shorthold tenancy which started after 6 April 2007. However it’s good practice for landlords to protect deposits in all circumstances. TDP schemes do not cover holding deposits.

Landlords who don’t protect their tenants’ deposits when required to can be taken to court by the tenant. They may need to repay the deposit plus a sum equivalent to three times the deposit. The landlord may also be unable to seek possession of their property.

Approved schemes



There are three TDP schemes approved by the UK Government:

Types of scheme

There are two types of TDP scheme:

  • Custodial – the DPS provides the only custodial scheme. It holds the deposit in a bank account and returns it at the end of the tenancy to the person who is entitled to it. This scheme is free to landlords and letting agents.
  • Insurance based – where the landlord or landlord’s agent holds the tenant’s deposit and pays a fee to insure it against landlord default. My Deposits and TDS are insurance based providers.

You should seek advice on the most suitable scheme for you.

Property Asset Finance is not responsible for the content of external websites.

For deposit protection schemes we act as introducers only.

Your property may be repossessed if you do not keep up repayments on your mortgage.

For more information, please call us on 01923 352235 or use the contact form.