Protecting a tenant’s deposit correctly isn’t just good practice, it’s the law. In England and Wales, any deposit taken on an Assured Shorthold Tenancy (AST) must be placed in a government-approved tenancy deposit scheme within 30 days of receipt. Landlords must also provide the tenant with the required written “prescribed information” about the deposit and how it is protected. Failing to protect a deposit on time or to supply this information can lead to serious penalties, including fines up to three times the deposit value. To comply, landlords should follow these steps, while taking advantage of the extra benefits offered by the Tenancy Deposit Scheme.
Step 1: Choose an approved scheme and register the deposit
The first step is to register the deposit with one of the three government-backed schemes TDS, MyDeposits or DPS. The Tenancy Deposit Scheme is often a popular choice because it offers two scheme options and several landlord perks. In the TDS Custodial Scheme, the landlord or agent simply transfers the deposit to TDS, which holds it in a secure account for the tenancy. This custodial option is completely free for landlords. In the TDS Insured Scheme, the landlord or agent keeps the deposit and pays a small fee to TDS for insurance protection, allowing the landlord to retain any interest earned. Importantly, TDS Insured is the most cost-effective, pay-as-you-go insured scheme available in the UK.
TDS offers award-winning service, and being the only not-for profit scheme, any surplus is reinvested into improving the service for landlords and tenants.
To register, simply create a TDS account and follow the prompts. The process requires basic tenancy details and the deposit amount. The TDS system will guide you through the Custodial or Insured option and give you a certificate once the deposit is registered.
Step 2: Provide the tenant with Prescribed Information
Within 30 days of receiving the deposit, you must give the tenant (and all relevant persons) detailed written information about the deposit protection. This prescribed information includes the scheme leaflet, contact details, how and when the deposit will be returned, and how disputes are handled. TDS makes this process simple. Once the deposit is protected, we automatically pre-populate the Prescribed Information, leaving you to just review and send it to the tenant.
Step 3: Keep records and evidence throughout the tenancy
Good documentation can prevent disputes later. We recommend keeping a signed tenancy agreement, a detailed inventory (with photos) of the property’s condition, and notes of all communications about the deposit. If disputes do arise, having clear evidence will make resolution easier. Remember: even after the tenancy ends, the deposit remains protected by the scheme until any disagreements over deductions are resolved. When it’s time to repay the deposit, you and the tenant should agree the split and TDS will return the funds accordingly. If you and your tenant can’t agree, you can refer the dispute to TDS for free, impartial resolution.
Step 4: Use TDS’s free resolution service
One of the biggest advantages of using TDS is its free, impartial deposit dispute service. If the tenant challenges any deductions, either party can raise a dispute at no extra cost. A professional TDS adjudicator will review the evidence and decide a fair outcome.
Notably, TDS has introduced a new self-resolution platform, that encourages landlords and tenants to negotiate directly before adjudication is needed. Through this online tool, you can make proposals on deductions and respond to the other party’s proposals. TDS’s early-resolution team may even call or email to help you reach agreement, saving time for everyone. If self-resolution fails, the case proceeds to formal adjudication. In all cases, TDS holds the disputed funds securely and enforces the adjudicator’s decision. The scheme’s adjudication process typically resolves cases within a few weeks. TDS Custodial disputes have no time limit, allowing parties to raise a repayment request at any time. For TDS Insured disputes, parties can initiate a claim up to 3 months after tenancy ends. Both processes follow the same adjudication timeline.
Because TDS is UK’s largest deposit protection scheme, backed by Propertymark, RICS and NRLA, you can be confident in their service. TDS’s customer service is highly rated, and all dispute handling follows the Ombudsman Association’s good practice, ensuring fair outcomes.
Step 5: Take advantage of TDS Landlord+
Once you’re a TDS customer protecting deposits, you gain free access to Landlord+, a rewards and membership scheme tailored for landlords. Landlord+ offers exclusive deals and discounts on things landlords need, such as safety certificates, training courses, software, mortgage vouchers, energy services, banking products, and more.
Another valuable service is the Tenancy Redress Service (TRS). The TRS is a free mid-tenancy mediation service that helps resolve issues like disrepair, rent problems or some anti-social behaviour without resorting to legal action. Any landlord or tenant can use the TRS if a problem threatens a tenancy. The TRS mediators will contact both parties and try to reach an amicable solution. This keeps tenancies on track and can often resolve complaints faster than court proceedings.
Why choose TDS for deposit protection?
- Not-for-profit and industry endorsed: TDS is the only not-for-profit deposit protection scheme in England and Wales. This means every penny goes back into service and innovation, not shareholders. TDS was created in 2003 and has grown to become the largest UK deposit protection and resolution provider in the UK. Its schemes are backed by major landlord organisations such as NRLA, RICS and Propertymark, giving you added confidence.
- Free or low-cost protection: The TDS Custodial scheme is free to use, and TDS Insured has the lowest fees of any insured scheme, plus NRLA-affiliated landlords pay reduced rates through TDS. In both cases, you enjoy award-winning service for a minimal cost.
- Award-winning support: At TDS, we pride ourselves on offering quick, knowledgeable support when landlords and letting agents need it most. Whether it’s a query about registering a deposit or help resolving a complex issue, our customer service team is consistently rated highly. Our support doesn’t stop once a deposit is protected, we’re here throughout the tenancy lifecycle to offer guidance, reassurance, and expert advice. TDS has achieved the government’s Customer Service Excellence accreditation for 10 consecutive years and holds ISO 10002 for customer satisfaction. Our customer support is rated Excellent (4.4/5 on Trustpilot), and we’ve won multiple industry awards recognising our outstanding service.
- Free and impartial adjudication: Every TDS-protected deposit comes with free adjudication. Whether you use Custodial or Insured, there’s no charge to submit a deposit dispute. TDS’s adjudicators are independent experts who apply tenancy law fairly.
- Innovative dispute tools: The self-resolution platform encourages communication between landlords and tenants. It reduces friction by letting you negotiate online. Many disputes settle through this tool before an adjudicator is involved.
- Landlord+ benefits: TDS customers get the Landlord+ reward scheme, with free savings on essential landlord services. No other deposit scheme offers this kind of membership package.
- Tenancy Redress Service: For mid-tenancy issues, TDS’s free mediation service is unmatched for helping to retain an ongoing tenancy. This keeps lines of communication open and avoids tenancy breakdowns.
Not with TDS?
The Tenancy Deposit Scheme is a government-approved provider, offering insured deposit protection schemes with industry-leading support and dispute resolution services.
The Tenancy Deposit Scheme is often the preferred choice due to its commitment to landlords, agents, and tenants alike. With years of experience, access to Agent+ and Landlord+ and a reputation for reliability, TDS ensures your deposit protection needs are met. Plus, The Tenancy Deposit Scheme offers both insured and custodial options (with the option to choose both schemes, or switch from one to another!)
Industry leading rates for agents and landlords
Joining TDS is quick and easy, protect today or speak to our switching experts to find out how TDS can support you! Affiliated members and NRLA members receive discounted rates on their deposit protection.
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