Tenancy Deposit Details
📊 Deposit Cap Breakdown
Under the Tenant Fees Act 2019, UK landlords and letting agents are legally restricted in the maximum security deposit they can demand from residential tenants.
Understanding the statutory 5-week rent cap (or 6-week cap for high-rent properties) and 30-day deposit protection rules prevents landlords from taking prohibited payments.
⚙️ Statutory Deposit Cap Rules for 2026/27
1. Statutory Security Deposit Caps (Tenant Fees Act 2019)
The maximum legal security deposit depends on your property’s total annual rent:
- Annual Rent Under £50,000: Security deposit is capped at a maximum of 5 weeks’ rent.
- Annual Rent £50,000 or More: Security deposit is capped at a maximum of 6 weeks’ rent.
- Calculation Formula:
Weekly Rent = (Monthly Rent × 12) ÷ 52. Maximum Deposit =Weekly Rent × 5(or× 6).
2. Refundable Holding Deposit Cap (1 Week Rent)
- Landlords or letting agents can request a refundable Holding Deposit to reserve a property while conducting referencing checks.
- Holding deposits are strictly capped at a statutory maximum of 1 week’s rent.
3. Mandatory 30-Day Government Protection Rule
Under Section 213 of the Housing Act 2004, landlords MUST protect a tenant’s deposit in one of three government-approved schemes within 30 calendar days of receipt:
- Deposit Protection Service (DPS)
- Tenancy Deposit Scheme (TDS)
- MyDeposits
- Landlord Penalty: Failure to protect within 30 days or issue Prescribed Information invalidates any Section 21 eviction notice and exposes the landlord to court fines of 1 to 3 times the deposit amount.
📊 Practical Tenancy Deposit Cap Worked Examples
Below are two worked calculation examples illustrating statutory deposit limits:
- Monthly Rent: **£1,500.00 / month**
- Annual Rent Total (£1,500 × 12): **£18,000.00**
- Calculated Weekly Rent (£18,000 ÷ 52): **£346.15 / week**
- Statutory Cap Tier: **5 Weeks Rent**
Calculation: Maximum legal security deposit = 5 × £346.15 = £1,730.77.
- Monthly Rent: **£4,500.00 / month**
- Annual Rent Total (£4,500 × 12): **£54,000.00** (Exceeds £50,000)
- Calculated Weekly Rent (£54,000 ÷ 52): **£1,038.46 / week**
- Statutory Cap Tier: **6 Weeks Rent**
Calculation: Maximum legal security deposit = 6 × £1,038.46 = £6,230.77.
📑 Common Pitfalls & Deposit Protection Warnings
- Taking Prohibited Extra Fees as ‘Pet Deposits’: Landlords cannot demand a separate £500 ‘pet deposit’ if the combined total security deposit exceeds the statutory 5-week rent cap.
- Failing to Serve Prescribed Information: Simply transferring cash into DPS or TDS is insufficient. Landlords MUST serve official Prescribed Information (scheme terms, tenancy details, dispute procedures) signed by the landlord within 30 days.
- Holding Deposit Forfeiture Rules: Landlords can only retain a 1-week holding deposit if the tenant provides false or misleading referencing information or voluntarily withdraws from the agreement.
❓ Frequently Asked Questions (FAQ)
Any deposit taken above the statutory 5-week cap is classified as a 'prohibited payment' under the Tenant Fees Act 2019. The excess cash must be refunded to the tenant immediately.
In a Custodial scheme, the deposit money is physically held by the government scheme. In an Insured scheme, the landlord retains the cash in their bank account and pays an annual insurance fee to the scheme.
If a tenant disagrees with landlord end-of-tenancy deductions (e.g. cleaning or damage), both parties can submit evidence to the deposit scheme's free **Alternative Dispute Resolution (ADR)** service.
Yes. Zero-deposit insurance schemes allow tenants to pay a non-refundable 1-week fee instead of a 5-week deposit. However, landlords cannot force tenants to use a zero-deposit scheme; traditional cash deposits must always be offered.