The Tenant Fees Act and tenancy deposit cap

For English tenancies, The Tenant Fees Act came into force on 1 June 2019. This made it illegal for landlords and letting agents to charge certain fees in connection with a tenancy.

The only payments that can be charged are rent, a refundable tenancy deposit, a refundable holding deposit, payments to change a tenancy and those associated with early termination of a tenancy (both when requested by the tenant), payments for certain utilities and services and default fees for late payment of rent and replacement of lost keys.

A breach of this legislation can be considered a civil offence, with a financial penalty of up to £5,000. Any further breaches within five years could result in a criminal conviction, a banning order and an unlimited fine. If a local authority chooses not to prosecute they can impose a financial penalty of up to £30,000 as an alternative.

The government has issued detailed guidance for landlords and letting agents, tenants and enforcement authorities which you can find here. The Welsh government introduced separate legislation for Welsh tenancies which didn't include a cap on tenancy deposits.

The deposit cap

A key part of the legislation was the introduction of a cap on the amount of the security deposit landlords can take for their tenancies. Tenancy security deposits are capped at the equivalent of five weeks' rent for assured-shorthold tenancies with an annual rent of up to £50,000, or six weeks' rent for tenancies with an annual rent of £50,000 or more.

The deposit cap applies to ALL new tenancies entered into from 1 June 2019, and any existing tenancies that are renewed on a fixed-term basis, including shorthold and student tenancies. It doesn't affect any tenancies signed before 1 June 2019 (irrespective of when the tenant actually moved into the property), although the cap applies to any future fixed-term renewals.

There are no special provisions or exemptions if the tenant has a pet. The maximum deposit amount allowed must still fall within the compliance thresholds above.

Check how much deposit you can take

Deposit Cap Calculator

We created our Deposit Cap Calculator to make it easy to check how much deposit you can take for a new or renewing tenancy.

Download the deposit cap calculator

Deposit Reduction Request form

If you've protected a higher deposit value than allowed by the legislation, we can reduce the deposit amount protected to align with the cap. Add the details of the deposits you need amended to our Deposit Reduction Request form and send them to depositcap@depositprotection.com. We'll make the changes and repay the amount requested to the tenants.

Download the Deposit Reduction Request form