Landlords across the UK are being warned that they have less than one month to register old deposits to comply with upcoming legislation.
From June 23rd, any residential deposit predating April 6th 2007 must be registered with an accredited scheme, such as the Deposit Protection Service, MyDeposits or the Tenancy Deposit Scheme.
Ever since 2007, landlords have been given 30 days from the start of a new shorthold tenancy agreement to register deposit details. However, changes to the Deregulation Act which will apply to historical tenancies could see many landlords left unaware, and facing the prospect of incurring large fines.
Justin Parker, lawyer, property expert and partner at Midland based law firm MFG Solicitors warns landlords that they could be at risk from the new amendments. Parker said that, ‘the fines for landlords and letting agents not registering are unlimited and they’re worked out at three times the initial deposit. So with a typical deposit of around £1,000, that’s potentially £3,000 for every deposit that was not registered.’
He went on to warn that, ’it is not just fines either. Landlords and indeed agents, who fail to register historical deposits will find it is difficult to remove tenants when the time comes because they will have failed in their obligations.’ Mr Parker suggests that, ‘the landlords most likely to be at risk are those who have had tenants for several years and the agreement has just rolled over. They may not have been aware of the need to register.’