The tenants may not be happy if you deduct money from their tenancy deposit. You can only deduct charges from the deposit that are fair, reasonable and for which you have evidence. The tenants can ask the deposit scheme, or the court, for help if they don't agree with your deductions.
Disputes over deposits
A deposit is the tenant's money. You can only take money from a tenancy deposit if
- you can prove that you have a right to take this money, and
- the charge is fair.
You'll need to explain to the tenants why you've charged them and why you believe these charges are fair.
If they don't agree with your deductions, the tenants may take you to court.
Using the deposit scheme to resolve a dispute over a tenancy deposit
You, or the tenants, can ask the deposit scheme to decide who should get the deposit if you cannot agree.
The deposit scheme will ask an adjudicator to look at the facts to decide who gets the money. The starting point is that it is the tenant's money, so you have to prove you have a right to keep some of it.
You will need to provide evidence to show that you are entitled to keep some of the money.
The adjudicator will review this evidence and decide how much, if any, of the deposit you should get.
You can ask the deposit scheme for a review of the adjudicator's decision if you disagree with it.
Going to court about a tenancy deposit
Your tenants may take you to court if they think you've unfairly kept their deposit and
- they paid the deposit before April 2013, or
- you failed to protect the deposit or renew the protection, or
- you used the deposit to cover rent and the tenants believe they had a right to withhold this rent.
The Small Claims Court will deal with the deposit case if the amount is up to £5000. The court will also expect you to provide evidence to show you are entitled to keep the tenant's money.
Going to court if you failed to protect the deposit
The law says you must protect any money you take as a deposit for a tenancy from 1 April 2013. You have to renew the protection if
- any of the tenancy details changes, or
- you ask for more money towards the deposit, or
- you give the tenants a new tenancy agreement
- or their agreement ends and they rent on a month-to-month basis.
Your tenants can take you to court to get their deposit back if you did not protect it. The court may take a negative view of your failure to follow the law.
What kind of evidence will you need to provide to the adjudicator or the court?
The type of evidence you provide depends on why you are making charges.
If you are claiming for cleaning costs or damage to the property or items, you'll need to provide
- the tenancy agreement term explaining what charges you can make from the deposit
- an inventory showing the cleanliness and condition of the items at the start of the tenancy
- an inventory showing the cleanliness and conditions of the items at the end of the tenancy.
You may also want to provide
- photographs of any damage, dirt or clutter you saw after the tenants moved out
- quotes for any repair or cleaning work
- make and model numbers of any damaged items
- receipts or cost information for the damaged items.
How much will you pay to settle a tenancy deposit dispute
You do not have to pay to use the deposit scheme's adjudication service.
You will have to pay court fees if
- you take legal action against your tenants, or
- they sue you and you decide to counterclaim against them.
The amount you'll pay depends on the value of your claim. You can find a list of County Court fees on the Department of Justice website.