In the current climate, TDS has received numerous questions from letting agents, landlords and tenants about how the impact of Covid-19 may affect tenancy deposit protection. In this week’s #AskTDS we answer a tenant’s question, “I am not yet leaving my tenancy but I cannot pay this month’s rent. Can I use my deposit to pay it?”.
The tenancy must have ended before any party may use the end-of-tenancy processes, which means you will not be able to use the tenancy deposit to pay the rent. The tenancy deposit protection legislation is written in a way that makes it clear that the deposit is for use at the end of the tenancy, not mid-way through the tenancy.
For example, Section 1(3)(b) sets out that in an Insured scheme, deposits are retained by the landlord on the basis that, at the end of the tenancy, deposits are agreed between the tenant and landlord and repaid to the tenant or, if not agreed and not repaid, paid to the deposit scheme when requested (as part of the dispute process).
See http://www.legislation.gov.uk/ukpga/2004/34/schedule/10 for more information about this section of the legislation.
The landlord should maintain a record of rent payments that were due and not paid. This can be in the form of a simple rent statement which can be used as evidence at the end of the tenancy if the rent remains unpaid.
Our advice to the tenant would be that we would recommend you speak to your landlord and explain the situation. Try to come to an agreement that works for you both in these unprecedented times.
TDS has created a FAQ page devoted to questions being asked about how Covid-19 may affect tenancy deposits. To see the list of the questions we have received and answered so far, visit our Covid-19 guidance page.
Tenancy Deposit Scheme (TDS) is a Government-approved scheme for the protection of tenancy deposits; TDS offers both Insured and Custodial protection and also provides fair adjudication for disputes that arise over the tenancy deposits that we protect.
We provide invaluable training in tenancy deposit protection and disputes for agents and landlords through the TDS Academy as well as joining with MOL to provide the Technical Award in Residential Tenancy Deposits.
TDS can only comment on the process for our scheme, other deposit protection schemes may have a different process/require different steps. Content is correct at the time of writing.
These views are those of the author alone and do not necessarily reflect the view of TDS, its officers and employees.