It is a good idea to ask the tenant to pay a deposit at the start of the tenancy to cover cleaning, breakage and damage that may occur during the tenancy.
The maximum level of tenancy deposit you can ask a tenant to pay depends on the total annual rent for the property:
up to five weeks’ rent if the total annual rent for the property is less than £50,000
up to six week’s rent if the total annual rent for the property is £50,000 or above
In England and Wales, deposits taken by landlords of assured shorthold tenancies (with rent up to £100,000 per annum) must comply with the tenancy deposit protection scheme.
The government-backed schemes are:
The schemes contain an Alternative Dispute Resolution (ADR) service which is free of charge. A dispute will only go to court if both landlord and tenant cannot agree to use the ADR service.
You will also need to provide the tenant wirth certain prescribed information.
In Scotland a deposit must not be more than two months' rent.
In Scotland, if you take a deposit from your tenant, it must be paid into an approved deposit protection scheme. This must be done within 30 working days of the tenancy start date. The government-approved schemes are:
For more information, read Deposit protection schemes.
Once a deposit has been registered, you will also need to provide the tenant wirth certain prescribed information.