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Landlords are being urged to register all deposits they have taken from tenants with an approved protection scheme before 23 June or face four-figure fines.
Historical deposits, such as those taken before 6 April 2007, must also be protected following the recent Deregulation Act in which the Government attempted remove red-tape across the sector.
Landlords must register the deposit with an approved scheme such as the Tenancy Deposit Scheme, MyDeposits, or the Deposit Protection Scheme.
The fines for failure to do so are unlimited and up to a maximum of three times the initial deposit plus the deposit – a hefty amount in many cases.
“The deadline of 23 June is looming, and it’s not just hefty fines that landlords must be wary of, they may also find it difficult to remove tenants when they wish to if they have failed with their deposit obligations,” explains a spokesperson for landlord insurance providers Discount Insurance.
With tenants typically putting down six weeks rent upfront and the average monthly UK rent currently standing a £768, this means a likely deposit of around £1,152 –even higher in areas such as London.
Although there are no firm figures on how many landlords have not registered deposits held, some experts believe up to one in three landlords in England and Wales could face fines, with those who have had rolling tenants for many years most likely to fall into the trap.
“Those who have had the same tenants for several years could be most likely to caught out as they may not be aware that they needed to register deposits,” added the spokesperson.
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