Since 2007, landlords in England and Wales have been legally required to protect tenancy deposits in one of three government-approved schemes. Understanding how these schemes work is essential for every tenant. This guide explains everything you need to know about the TDS, DPS, and MyDeposits schemes.
What Is Deposit Protection?
Deposit protection is a legal requirement under the Housing Act 2004 that ensures your tenancy deposit is held securely in one of three government-approved schemes — TDS, DPS, or MyDeposits. Your landlord must protect it within 30 days of receipt and provide you with prescribed information.
Deposit protection is a legal requirement under the Housing Act 2004. It ensures that your deposit is held safely and returned fairly at the end of your tenancy. The landlord must protect your deposit within 30 days of receiving it and provide you with specific information about where it's held.
If there's a dispute at the end of your tenancy, the scheme provides a free alternative dispute resolution (ADR) service to help resolve it without going to court.
What Are the Three Government-Approved Schemes?
1. Tenancy Deposit Scheme (TDS)
TDS is one of the longest-running schemes, established in 2007. It offers both custodial (free, deposit held by TDS) and insured (landlord holds deposit, pays fee) options. TDS is particularly popular with letting agents and larger landlords.
- Website: tenancydepositscheme.com
- Check if protected: Use their online lookup tool with your postcode and tenancy start date
- Dispute resolution: Free ADR service available
2. Deposit Protection Service (DPS)
DPS is the only scheme that's completely free for landlords when using their custodial service (where DPS holds the deposit). This makes it very popular with private landlords. It's operated by Computershare Investor Services.
- Website: depositprotection.com
- Check if protected: Online lookup requires your tenancy ID or postcode
- Dispute resolution: Free ADR with independent adjudicators
3. MyDeposits
MyDeposits is run by a joint venture between the National Landlords Association and Hamilton Fraser Insurance. They offer both custodial and insured schemes, with competitive rates for the insurance-backed option.
- Website: mydeposits.co.uk
- Check if protected: Use their deposit checker with your details
- Dispute resolution: Free ADR through The Dispute Service
Tip: You can check all three schemes to see if your deposit is protected. Each scheme has a free online lookup tool. If your deposit isn't registered with any of them, you may have a claim for compensation.
Custodial vs. Insured Schemes
Each approved scheme offers two types of protection:
Custodial (Money Protected)
The scheme holds your deposit directly. This is free for landlords and often considered more secure for tenants as the money is held by an independent third party. At the end of the tenancy, the deposit is released based on agreement or ADR decision.
Insured
The landlord keeps your deposit but pays an insurance premium to the scheme. The insurance guarantees you'll get your money back even if the landlord doesn't cooperate. However, the landlord has more control over the deposit during the tenancy.
What Information Must You Receive?
Within 30 days of receiving your deposit, your landlord must provide you with:
- The address of the rented property
- How much deposit you paid
- Which scheme the deposit is protected with
- The scheme's contact details and dispute resolution process
- Your landlord's contact details
- Information about the circumstances under which part or all of the deposit may be retained
- What to do if you can't reach your landlord at the tenancy end
Failure to provide this 'prescribed information' is itself a breach that entitles you to compensation, even if the deposit was protected.
What Happens If Your Deposit Isn't Protected?
If your landlord failed to protect your deposit or didn't give you the required information, you have legal rights. A court can order:
- Return of your full deposit
- Compensation of 1-3 times the deposit amount
- The landlord cannot use Section 21 (no-fault eviction) until the deposit is protected
You can make a claim while you're still a tenant or up to 6 years after your tenancy ends. Learn more in our guide on what to do if your deposit wasn't protected.
How to Resolve Deposit Disputes
If you disagree with deductions your landlord wants to make, all three schemes offer free Alternative Dispute Resolution (ADR). This is quicker, cheaper, and less stressful than going to court. The process typically takes 4-8 weeks.
An independent adjudicator will review evidence from both sides and make a binding decision. Make sure you have photos, the inventory, your tenancy agreement, and any relevant correspondence to support your case.