10 deposit protection DOs and DON’Ts every landlord should know in 2026

Protecting your tenant’s deposit properly is not just a legal box to tick, it’s vital to a smooth, trust-filled tenancy.  Now, with rental laws changing it’s more important than ever to get deposit handling right. The Tenancy Deposit Scheme shares 10 essential DOs and DON’Ts for deposit protection in England and Wales. Follow these tips to stay compliant with current legislation and keep things hassle-free with your tenants. Let’s dive in! 

1. DO protect the deposit within 30 days

Any deposit you take for an Assured Shorthold Tenancy (AST) must be protected in a government-approved scheme within 30 days of receipt. Miss that deadline and you risk financial penalties and restrictions on regaining possession. You can choose between a custodial or insured scheme that suits how you manage your finances, but don’t delay. Late protection is treated the same as no protection at all. Tenants can take you to court and you could be ordered to pay them a penalty of 1 to 3 times the deposit amount as compensation, so make sure you protect the deposit on time, it’s easy and keeps you on the right side of the law. 

2. DO give tenants the Prescribed Information and Scheme leaflet

Protecting the deposit is only part of the process. Landlords must also provide the tenant (and anyone who paid the deposit on their behalf) with deposit scheme leaflet, and the required Prescribed Information (PI) within the same 30-day timeframe. This information explains how the deposit is protected, with which scheme, and what to do if there is a dispute. It’s good practice to keep clear evidence of when and how the Prescribed Information was served, as this can be important if compliance is later queried or a dispute arises at the end of the tenancy. TDS has a PI template with suggested clauses to use here. 

3. DON’T take more than the legal deposit cap

The law is clear on how much you can take as a deposit. Under the Tenant Fees Act 2019 in England (and equivalent legislation in Wales), deposits are capped at five weeks’ rent for most tenancies. The only exception is where the annual rent exceeds £50,000, allowing up to six weeks’ rent. Any amount above this, including additional charges such as “pet deposits”, is a prohibited payment. 

Holding an unlawful deposit or fee can also affect your ability to regain possession. While the Renters’ Rights Act has changed the possession process, compliance with deposit and fee rules remains essential. In short, stick to the legal limit of five weeks’ rent is usually sufficient and keeps you compliant. 

4. DO use a detailed check-in inventory

A clear, thorough inventory is one of the best protections you have as a landlord. 

Prepare a clear, room-by-room inventory at check-in, recording the condition of walls, floors, furniture and appliances, and noting any existing wear or damage. Support this with date-stamped photos or a short video walkthrough, and give the tenant the opportunity to review and comment. 

While it can feel like extra work, a detailed inventory sets clear expectations for how the property should be returned and provides vital evidence if issues arise. Without this evidence, it can be difficult to justify deductions, but with it, landlords are better placed to resolve disputes fairly. 

5. DON’T neglect mid-tenancy check-ups and maintenance

Deposit protection goes hand in hand with good property management during the tenancy. Carrying out periodic mid-tenancy inspections, with proper notice, can help identify small issues early before they escalate into disputes at the end of the tenancy. 

Keeping communication open and responding promptly to any tenant concerns can also make a real difference. Where disagreements do arise, the Tenancy Redress Service can help resolve matters before they affect the tenancy. Being proactive during the tenancy often means fewer problems - and fewer deposit issues - at the end. 

6. DO set expectations before move-out

As the tenancy draws to a close, it helps to remind tenants what’s expected, particularly around cleaning and any responsibilities set out in the tenancy agreement. A friendly email or letter a few weeks before move-out, encouraging them to refer back to the check-in inventory, can help prevent misunderstandings. Setting expectations early increases the likelihood of the property being handed back in good condition, reduces the need for deductions, and makes the deposit return far more straightforward for everyone. 

7. DON’T make blanket or excessive deductions

When a tenancy ends and you’re claiming from the deposit, it’s important to be reasonable, taking into account fair wear and tear. Claiming the full deposit for minor issues often leads to disputes, particularly around cleaning, which remains one of the most common areas of disagreement. TDS’ platform allows landlords to start with self-resolution, using its online platform to explain proposed deductions and the reasons for them. This helps both sides reach an outcome without escalating the issue. 

8. DO back up deductions with evidence

If you plan to make deductions, evidence is key. 

That includes: 

• Check-in and check-out inventories 

• Photos 

• Invoices or quotes 

• Relevant correspondence 

If a claim can’t be supported, it’s unlikely to succeed if challenged. 

9. DON’T delay returning the deposit

Once amounts are agreed, deposits should be returned within 10 days. 

If part of the deposit is disputed, release the undisputed amount promptly. Clear communication at this stage goes a long way toward avoiding complaints or escalation. 

10. DO stay up to date with rental reform

Recent changes under the Renters’ Rights Act 2025 will reshape how tenancies operate in 2026, including the move to periodic tenancies and the end of Section 21. Alongside this, landlords in Wales should continue to keep an eye on developments under the Renting Homes (Wales) Act.  

While the framework has changed, the requirement to protect deposits correctly remains the same. Staying informed through trusted sources such as NRLA guidance, government updates and TDS resources will help you remain compliant, avoid enforcement issues, and adapt confidently as the sector continues to change. 

Not with the Tenancy Deposit Scheme?

Visit our TDS Help Centre to find more guides, tools and templates, all designed to make the life of our customers easier.  Some of our resources are only available to customers who use the free deposit protection scheme at TDS Custodial or the insured scheme at TDS Insured. You can access all templates, tools and the full tenancy deposit management dashboard by joining the Tenancy Deposit Scheme.