New tenant decided to not proceed with tenancy on start date?

Very simple!

Give them their Money back and find a new tenant that will appreciate the property.

What is the point of have an unhappy tenant it will only cause you problems.

You should be able to charge them for the void period but I wouldn’t bother.

Focus on reletting the flat – you had other would-be tenants interested; you will presumably rent it out quickly enough. You a week deposit as a small compensation. Return their secured deposit and send them on their way. Why invest time and energy attempting anything else?

I would ask him to put in writing that he no longer wants the property and thereby surrenders the AST.
If you have lodged the deposit with say DPS, I would give him details and let him claim it back from them.
If you are holding deposit in an Insured Scheme I would return the money to him, ensuring you get a receipt.
I believe you are entitled to retain the holding deposit (according to Shelter), to cover void and costs of setting up the AST with him, but I expect you could return it or part of it to him if you so wished.
But best get it all checked out with specialist, you don’t want any come back and end up with a court case!

Further to my previous comment and re reading your query, I would think that as the AST was signed it is a legal contract which both parties are obliged to adhere to.
You as landlord would struggle to get out of the contract.
But as others have said if he’s not happy then best to allow him to withdraw.

He has signed a legal contract to pay rent for the term of the tenancy. If your AST is very specific and allowed for the use of deposit for non payment of rent or early release then you would be permitted to retain the deposit.

Get him to put his withdrawal in writing. Then negotiate directly with him explaining what you have in your post. It may well be you can reach a 50/50 compromise. This can then be forwarded to your Deposit Scheme.

The contract is valid. Both parties signed and you did not withhold access, they simply changed their mind after entering into the contract.

Although you could seek to apply the contract, the most equitable solution is for him to confirm that he is happy for you to remarket it to find a replacement tenant at the earliest opportunity in order to mitigate his liability.

As the AST exists, the holding payment becomes the first week’s rent and any additional period up to the start of the replacement tenancy can be claimed from the deposit, subject to your tenancy and deposit terms.

Given its a valid AST.
Should the T not be required to complete a Deed of Surrender?

If the AST was signed by both parties and dated before the visit on 10 March, the tenant has to pay the rent for the fixed term unless you find a replacement tenant and release him early. Obviously, the sooner you find someone else to take the flat, the more likely that the deposit you’re holding will cover the rent owed under the AST. You have to mitigate your loss, so a court would not be impressed if you try to say you are entitled to keep the flat empty and claim the full 6 months’ rent from him.

Surely the holding deposit was deducted from the amount of the rent deposit, not an additional sum? You should only have 5 weeks’ deposit, all with DPS.

If the AST was signed by the tenant but not signed and dated by you, then the tenant may have withdrawn his release of the signed AST to you for dating, so then he is not bound and you may only be able to keep the one week holding deposit.

It’s not a problem. The tenancy contract was signed by both parties and a deposit has been paid. The contract has been formed and accepted.

They are in breach of contract if they don’t pay rent.

The tenancy isn’t started until they take possession of the property, but the contract is formed and in effect.

Remind them of their obligations, Tell them you’ll remarket the property, and until a new tenant signs a contract, they’ll remain liable for rent. If rent isn’t paid it will be first deducted from the deposit but if insufficient it will be recovered from small claims court which may result in a CCJ.