December 5, 2011
Tenancy Deposit Scheme set to Change
The Localism Act 2011 is due to come into force some time in 2012, and with it will come several changes to the current tenancy deposit scheme. The biggest change will be the length of time that landlords have to secure their tenant’s deposit money within one of the Government approved schemes. At present a landlord has 14 days to deposit money however the changes due for 2012 will see this increased to 30 days.
Another change that could affect some landlords is the disregarding of mandatory penalties for those who fail to register their deposits correctly or fail to give their tenants the required information regarding the tenancy deposit scheme. Current legislation states that a fine equal to three times the deposit amount is payable by landlords who breach the terms of the Act, but as of next year the size of the penalty incurred will be at the discretion of the court, and could be as little as the actual deposit amount.
The changes are being made in an effort to decrease the number of challenges reaching the courts. Hopefully the increased length of time available to landlords who own buy to let property to register their deposits will mean more landlords complete the process correctly, and as a result fewer tenants will have need to make formal complaints.
