Many tenants in the private sector give their landlords a deposit against possible non-payment of rent or damage to property. When a tenancy comes to an end, there is usually no disagreement about the return of the deposit. But sometimes there is, and this can cause much hardship and inconvenience to both the landlord and the tenant.
The Tenancy Deposit Scheme for Regulated Agents (TDSRA) has been developed to ensure that the deposits they hold are protected and that disputes about their return are resolved swiftly, inexpensively and impartially.
Under the Scheme:
deposits will be protected during the tenancy
where there is no dispute at the end of the tenancy, deposits will be returned promptly
where there is a dispute about the return of the deposit it will be dealt with fairly by the Independent Complaints Examiner (ICE)
The ICE will make his decision quickly, and the deposit will be paid out without unnecessary delay.
What is a regulated agent?
Regulated agents are:
members of the Association of Residential Letting Agents, the Royal Institution of Chartered Surveyors, the National Association of Estate Agents, or other bodies which regulate the activities of their members in the private rented sector ; and
covered by a recognised bonding scheme which protects and insures money they are holding on behalf of landlords and tenants.
How are the deposits held and protected?
The agent managing the property holds the deposit in their own bank account (or in a special client account if their total deposits are above a certain amount). A company called The Dispute Service (The Dispute Service Limited) has been set up to ensure deposit protection.
What happens at the end of the tenancy?
If there is no dispute the agent will keep or repay the deposit, according to their agreement with the tenant and the landlord. If there is a dispute, the agent has a couple of weeks to resolve it. After that, any of the parties – landlord, agent or tenant – can approach the ICE. He will appoint an adjudicator to assist him in considering the evidence they provide, and will issue his decision within 10 working days of receiving the all the necessary papers
If there is a dispute, what happens to the deposit?
The agent will transfer the deposit to The Dispute Service Limited. It administers an Assurance Fund, which enables the ICE to carry on with an adjudication and to pay out the deposit even if the agent has not sent it to him. The Dispute Service Limited will pay out the deposit according to the instructions of the ICE following his award. If the agent has not sent the deposit, The Dispute Service Limited will draw it from the Assurance Fund.
Who could join TDSRA?
Any regulated agent operating in Great Britain and Northern Ireland may join the Scheme if they belong to professional body approved by the ICE and The Dispute Service Limited.
What is an Approved Body?
The Approved Bodies contribute to the Assurance Fund. They are also expected to take appropriate disciplinary action against firms who have failed to comply with the rules of the Scheme. The Association of Residential Letting Agents, the Royal Institution of Chartered Surveyors and the National Association of Estate Agents were the three approved bodies for the TDSRA.
How much does it cost?
The service has an administration Charge of £15 + VAT to both the landlord and Tenant
Management of TDSRA
The Scheme is managed by The Dispute Service Limited. The ICE is its Chief Executive and reports to a Board currently made up of people from the residential lettings industry. Within the next year it will be replaced by a Board recruited by general advertisement. The Board of The Dispute Service Limited has no role in the resolution of disputes or in the day-to-day management of the company.