Tenancy Deposits
It is very common practice for most private landlords to collect a tenancy deposit in case the tenant causes any damage to the property or doesn't pay their rent or bills.
When can a landlord take money out of the deposit?
The deposit belongs to the tenant and should always be returned at the end of a tenancy unless the landlord has suffered financial loss. Landlords can also make some deductions for:
- damage to the property
- unpaid rent
- missing items
- cleaning
Even when a landlord has reason for keeping some of the deposit, the remaining deposit should be returned. The tenant is well within their rights to ask for receipts or estimates for any items which have deducted from your deposit.
Landlords are not permitted to withhold any of a deposit for reason such as "tenant had a noisy party despite the tenancy agreement forbidding them". This sort of claim is not only unreasonable its also not legal. Landlords can only claim for any financial loss they have actually suffered.
Cleaning deductions.
Some tenancy agreements state that carpets and curtains must be cleaned to a professional standard before the tenant moves out. This does not however mean that they need to be as clean as when you moved into the property. Tenants are only required to clean anything which has been soiled above normal wear and tear.
Damaged property.
If a property or its contents are damaged then the tenant should be expected to repair or replace the item. The tenant only needs to replace like for like, so if they damage an old fridge then they only need to replace it with an old fridge or pay the cost to get a similar fridge second hand. The tenant is not expected to replace items with brand new items, and they are not expected to repair or replace normal wear and tear (e.g if the carpet has worn down from daily use).
Outstanding Rent.
If a tenant still owes rent then the landlord is within their rights to deduct the outstanding rent from the deposit. If the deposit does not cover the outstanding rent then the landlord can take the tenant to court in order to get their money back.
If a tenant withholds the last month's rent to try and counter this then the landlord can take the tenant to court to recover the missing funds
In order to avoid any confusion or potential conflicts regarding security deposits it's a good idea to make a detailed inventory survey of the property.
The best way to do this is have a detailed form listing everything in the house (inc fixtures and fittings, carpets, walls) and walk around with the tenant rating the condition of each item on the list. Once the list is complete both you and the tenant should sign the inventory.
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