0151 665 0320The Renters’ Rights Act has fundamentally changed the framework for private renting in England — and while its abolition of no fault eviction has attracted the most headlines, the Act also affects how tenancy deposits work, how they interact with the new tenancy regime, and what both landlords and tenants need to know right now.
This article explains how the deposit rules fit with the new law, what has changed and what has stayed the same, and what your options are if a deposit has not been correctly handled.
The Core Deposit Protection Rules Have Not Changed
The fundamental obligation to protect a tenancy deposit has not been altered by the Renters’ Rights Act. Landlords are still required to:
Protect the deposit in a government-approved tenancy deposit protection scheme within 30 days of receiving it. The three approved schemes are the Deposit Protection Service (DPS), MyDeposits, and the Tenancy Deposit Scheme (TDS).
Serve the prescribed information on the tenant — and any relevant person such as a guarantor — within 30 days. The prescribed information must include the details of the scheme used, the amount protected, and information about what happens at the end of the tenancy.
Return the deposit (or the agreed balance) within 10 days of the tenancy ending if both parties agree on the deductions. If there is a dispute, the protected amount remains in the scheme until resolved.
These obligations have been in place since 2007 and remain fully in force under the Renters’ Rights Act.
What Has Changed: Deposits and the New Tenancy Regime
The most significant change affecting deposits under the Renters’ Rights Act relates to the transition from fixed-term assured shorthold tenancies to rolling assured periodic tenancies.
From 1 May 2026, existing assured shorthold tenancies automatically converted to assured periodic tenancies — rolling tenancies with no fixed end date. This has implications for how deposits are held and when they can be returned.
Under the old fixed-term system, a deposit was linked to a specific tenancy with a known end date. Under a rolling periodic tenancy, the tenancy has no end date, and the deposit remains protected for the duration of the tenancy. Landlords should ensure that their deposit protection is kept up to date and that the prescribed information reflects the current position.
If you have a tenancy that converted on 1 May 2026, your deposit should already be protected. If it was not protected before conversion, you may already be in breach of the deposit protection rules — and the conversion does not resolve that breach.
Rent in Advance: New Restrictions
One new deposit-adjacent rule introduced by the Renters’ Rights Act relates to rent in advance. From 1 May 2026, a landlord cannot ask for, encourage, or accept rent in advance before the tenant has signed the tenancy agreement. Once the agreement is signed, a maximum of one month’s rent in advance can be requested.
This is distinct from the deposit but is related in the sense that landlords can no longer use large advance rent payments as a substitute for proper deposit protection. Some landlords had previously sought multiple months’ rent in advance as a way of gaining greater financial security — this practice is now unlawful.
What Happens If the Deposit Was Not Protected?
If a landlord fails to protect a deposit, or fails to serve the prescribed information on time, the tenant may apply to the county court for a penalty of between one and three times the deposit amount. The court has discretion on the exact amount, taking into account the landlord’s conduct, whether the breach was deliberate or accidental, and whether it has subsequently been remedied.
Failure to protect a deposit also affects the landlord’s ability to serve a valid notice to end the tenancy. Under the old law, a landlord who had not protected a deposit could not serve a valid Section 21 notice. Although Section 21 eviction has now been abolished, the principle that deposit non-compliance undermines the landlord’s position in any possession proceedings remains relevant.
In some cases, a tenant may also be able to bring a rent repayment order application alongside a deposit claim, if the landlord’s non-compliance with deposit rules forms part of a wider pattern of breaches. Cook Legal Solicitors advises tenants on both deposit claims and rent repayment order applications.
Deposit Deductions: The Rules Under the New Regime
The rules on what a landlord can deduct from a deposit have not changed under the Renters’ Rights Act, but it is worth revisiting them given the changes to the tenancy structure.
A landlord can deduct from the deposit for: unpaid rent, damage to the property beyond fair wear and tear, cleaning costs where the property was not left in an appropriately clean condition, and any other breach of the tenancy agreement that caused a financial loss.
A landlord cannot deduct for: fair wear and tear — the natural deterioration of the property through normal use over time — or for improvements the landlord wishes to make that were not required by the tenancy agreement.
Under the rolling tenancy regime, where there is no fixed end date, deductions become relevant only when the tenancy actually ends — whether by the tenant giving two months’ notice, the landlord successfully obtaining possession on a valid ground, or by mutual agreement. The same rules about timing and scheme dispute resolution apply.
Challenging Unfair Deposit Deductions
If you are a tenant who believes your landlord has made unfair deductions from your deposit, you have two main routes to challenge this:
Scheme dispute resolution. All three government-approved deposit protection schemes offer a free alternative dispute resolution (ADR) service. You can refer the dispute to the scheme’s adjudicator, who will consider the evidence from both sides and make a binding decision. This is free to use and is usually faster than going to court.
Court claim. If the landlord has not protected the deposit at all, or if you need to recover a larger sum alongside other claims, you can bring a court claim. A solicitor can advise you on the most effective approach depending on the amount involved and the circumstances of your case.
The Interaction Between Deposits and Rent Repayment Orders
A rent repayment order is a separate legal mechanism from a deposit claim, but the two often arise in related circumstances. A rent repayment order can be sought from the First-Tier Tribunal where a landlord has committed certain specified housing offences — including illegal eviction, failure to licence a property, or breach of a banning order. If granted, it can require the landlord to repay up to two years’ rent.
If you are a tenant who has suffered both an unprotected deposit and other housing offences by your landlord, Cook Legal Solicitors can advise you on how to bring both a deposit compensation claim and a rent repayment order application in a coordinated way to maximise your recovery.
Frequently Asked Questions
Does the Renters’ Rights Act change how long a landlord has to protect my deposit?
No. The 30-day deadline to protect a deposit and serve the prescribed information has not changed. What has changed is the tenancy structure — deposits are now held for the duration of a rolling periodic tenancy with no fixed end date, rather than for a fixed term.
What should I do if my deposit has not been protected?
If your landlord has not protected your deposit, you may be entitled to a penalty of between one and three times the deposit amount. You should seek legal advice promptly. Cook Legal Solicitors can advise you on whether you have a claim and what evidence you will need.
Can my landlord ask for more than one month’s deposit?
No. The Tenant Fees Act 2019 caps tenancy deposits at five weeks’ rent for annual rents under £50,000, or six weeks’ rent for higher rents. This cap remains in force. Combined with the new restriction on rent in advance under the Renters’ Rights Act, landlords have significantly less ability to demand large upfront sums from tenants.
What is a rent repayment order and how does it relate to deposit claims?
A rent repayment order is a tribunal order requiring a landlord to repay up to two years’ rent where certain housing offences have been committed. It is separate from a deposit claim but can be pursued alongside one. Cook Legal Solicitors advises on both types of claim.
Can I challenge deposit deductions under the new rolling tenancy?
Yes. The process for challenging deposit deductions is the same as before — scheme dispute resolution or court claim — and is not affected by the conversion to a rolling periodic tenancy. The key change is that deductions only become relevant when the tenancy actually ends, which can now happen at any time rather than at a fixed end date.
Get Advice from Cook Legal Solicitors
Cook Legal Solicitors specialises in tenancy deposit disputes, rent repayment order applications, and all aspects of the Renters’ Rights Act. Whether you are a tenant seeking to recover an unprotected deposit or challenge unfair deductions, or a landlord wanting to ensure your deposit processes are fully compliant, we can help.
Contact us today for a free initial discussion.