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Frequently Asked Questions

What is an Assured Shorthold Tenancy (AST) ?

Assured shorthold tenancies were introduced by the Housing Act 1988, with important changes made by the Housing Act 1996;( + expand info )

  • When did ASTs begin?
  • ASTs apply to agreements started on or after 15 January 1989.
  • Am I an assured shorthold tenant?
  • You are likely be an assured shorthold tenant if you pay rent to a private landlord and you moved into your accommodation on or after 28 February 1997.
  • What types of tenancy forms do you sell?
  • Since the 1996 Housing Act, which came into force on 1 February 1997, all forms, unless they say otherwise, are now ASTs. Agreement 19 (unfurnished property) and Agreement 20 (furnished property) are our most popular tenancy forms. Since the introduction of the Tenancy Deposit Scheme Regulations we now also supply combined AST and deposit scheme forms: AGREE21 for use with my deposits; AGREE22 - The Tenancy Deposit Scheme; AGREE23 - Deposit Protection Service, custodial scheme and AGREE24 - Deposit Protection Service, insurance scheme. Other forms include; Agreement AGREE3C, AGREE2D, AGREE3, AGREE3B, AGREE2B and AGREE1. Agreement forms AGREE3*, AGREE3A, AGREE3H and AGREE14B fall outside the scope of the Housing Acts and should only be used in special situations, e.g. letting a shop, or letting land for agricultural purposes. Agreement 3H is for letting unfurnished property to a Tenant Company. We do not publish a furnished Company Let form.

They are for a fixed period of time;( + expand info )

  • What is the length of an AST?
  • There is no maximum period for the letting of a property on an AST. However, you cannot seek possession against your tenant using section 21 of the Housing Act during the first four months of the tenancy.
  • What is the shortest notice period that can be given on an AST?
  • Assuming that the tenant has not broken any of the terms of the Agreement from the 1st October 2015 a tenant is entitled to at least of two months' notice. However, if the tenancy started on a periodic basis without any fixed term a longer notice period may be required depending on how often the rent is paid, i.e. if you pay rent quaterly at least 3 months' notice is required, or if the rent is paid half yearly or annually then at least 6 months' notice is required. Notice must be given on form HA21SR. For ASTs created prior to 1st October, there is no obligation to use this form, however it may nevertheless be used for all ASTs. Therefore when the landlord wants to recover possession of an AST created prior to 1st October 2015 he/she may still use HA21 for a fixed term AST or HA21A nk">HA21 for a periodic tenancy.
  • What is an Assured Periodic Tenancy (APT)?
  • An AST will automatically become known as an Assured Periodic Tenancy (APT) if the tenancy overruns e.g. a tenant, originally given a 12 month tenancy, with the consent of the landlord, is still there after 15 months. From 1st October 2015, when the landlord wants to recover possession, he/she must use form HA21SR. However, for tenancies created prior to 1st October a landlord may still use form HA21A.

The tenant is renting from a private landlord;( + expand info )

  • I am letting my property privately, not through an agent. How do the Tenancy Deposit Scheme regulations affect me?
  • You must comply with them, either by paying the deposit into the custodial scheme or by joining one of the insurance schemes. If you are a "small landlord", with only one or two properties, it will almost certainly be better for you to use the custodial scheme, as it is free.

The property is the tenant's main residence;( + expand info )

  • If the property is not going to be my main residence can I enter into an assured shorthold tenancy?
  • No this would not be an assured shorthold tenancy, but an ordinary contractual tenancy. You need to be sure of this situation and as certain as you can be that it will continue for the duration of the tenancy. For example, if a tenant lives with his family elsewhere at weekends and uses the property during the week returning home at weekends.
  • Is an ordinary contractual tenancy affected by the Tenancy Deposit Scheme regulations?
  • No, as the tenancy is not an assured tenancy you can take a deposit without having to pay it into the Government's tenancy deposit scheme.
  • Which forms are used to give notice on an ordinary contractual tenancy?
  • To end this tenancy you do not need to use HA21SR or a Section 8 Notice (HA32). This is because it is a common law tenancy. The tenancy starts as a fixed term tenancy. This means that the tenant can stay there until the end of the fixed term so long as he pays the rent/complies with the tenancy terms. You will then need to give a notice to quit (L&T61) to end the tenancy.

The property is the landlord's principal or only residence;( + expand info )

  • If the property is the landlord's principal or only residence can we enter into an assured shorthold tenancy?
  • Dependent on the circumstanes this would not usually be an assured shorthold tenancy, but either an excluded tenancy or licence.
  • Do I have an AST if I do not have exclusive use of all of my property?
  • If the occupier does not have exclusive use of any part of the accommodation, he or she is likely to have a licence to occupy, not an AST. The agreement will probably be a licence where you have specified that you require unrestricted access to the occupant's room to provide services such as cleaning.
  • What form can I use for letting rooms within my property?
  • AGREE6 -Tenancy Agreement Resident Landlord - This agreement is intended for use where a person occupying property as his or her only or principal home wants to let a part of that property while carrying on living in the rest of it himself or herself, or where two or more people occupying property as their only or principal home want to do so.

The tenant is entitled to privacy in the property.( + expand info )

  • Is the landlord allowed to enter my property without my knowledge
  • No, the landlord cannot enter the property without formal notice and mutual agreement.
  • Do I have an AST if I do not have exclusive use of all of my property?
  • If the occupier does not have exclusive use of any part of the accommodation, he or she is likely to have a licence to occupy, not an AST. The agreement will probably be a licence where you have specified that you require unrestricted access to the occupant"s room to provide services such as cleaning.

The rent is less than £100,000.00 a year. ( + expand info )

  • Is the annual rent payable for an AST in England subject to any financial limit?
  • From 1st October 2010, any new AST which is created in England after this date with a rent payable up to a maximum of £100,000 per year must have the deposit protected in accordance with the Tenancy Deposit Scheme.

Ending the tenancy/ increasing rent. ( + expand info )

  • What is the shortest notice period that can be given on an AST?
  • Assuming that the tenant has not broken any of the terms of the Agreement from the 1st October 2015 a tenant is entitled to at least of two months' notice. However, if the tenancy started on a periodic basis without any fixed term a longer notice period may be required depending on how often the rent is paid, i.e. if you pay rent quaterly at least 3 months' notice is required, or if the rent is paid half yearly or annually then at least 6 months' notice is required. Notice must be given on form HA21SR.
  • Which forms are used to give notice on an AST?
  • For normal notice, where the Tenant has not breached the agreement, from the 1st October 2015 form HA21SR enables landlords to recover possession of the property under sections 21(1) and 21(4) of the Housing Act 1988. HA32 is only to be used in exceptional cases where, for instance, the tenant has stopped paying the rent and therefore is in breach of his/her tenancy agreement with the landlord.
  • How do I increase the rent in (a) an APT, and (b) an AST?
  • (A) Form HA33B to increase the rent on an APT. Form HA36 can be used to refer a proposed increase to a Rent Assessment Committee. (B) There is no form to increase the rent on an AST. Once created, an AST cannot have any of its terms materially altered without it first being brought to an end and a new AST being created.
  • What form is used to evict a tenant or licensee?
  • L&T61 - this form can also be used for an assured tenancy.

What is a Tenancy Deposit Scheme?

Tenancy Deposit Scheme were introduced by the Housing Act 2004 with important changes made by Housing (Tenancy Deposits) (Prescribed Information) Order 2007 (SI 2007/797));( + expand info )

  • When did the tenancy deposit scheme begin?
  • The tenancy deposit scheme came into force on 6 April 2007.
  • I am letting my property privately, not through an agent. How do the regulations affect me?
  • You must comply with them, either by paying the deposit into the custodial scheme or by joining one of the insurance schemes. If you are a "small landlord", with only one or two properties, it will almost certainly be better for you to use the custodial scheme, as it is free.

There are three authorised UK government Tenancy Deposit Protection (TDP) schemes: MyDeposit Scheme Tenancy Deposit Scheme (TDS) Deposit Protection Scheme ( + expand info )

  • Are there are any alternative schemes to the three set up at present?
  • No; any previous local or voluntary deposit protection schemes are not permitted to take new deposits or accept new cases after 6 April 2007. It is quite possible that different schemes and/or scheme operators will be appointed in future after the expiry of the initial contracts awarded by the Government to the current operators of the schemes.
  • Who pays for Tenancy Deposit Schemes?
  • The custodial scheme is free to landlords and tenants. It is self-financing by earning interest on the deposits it holds. The insurance based schemes require the landlord to pay a fee to join, with repeat fees in time as with most other insurance-based services.
  • Can I ask the tenant to pay the cost of my joining one of the insurance-based schemes?
  • This may be unenforceable, and in any case unrealistic in practice, as the custodial scheme is free to use.
  • A prospective tenant's father has offered to stand as guarantor instead of a deposit being paid. Is this affected by the regulations?
  • No, because no money is paid as a deposit.
  • A prospective tenant's father has offered to pay the deposit for his daughter, on the basis that it will be repaid to him at the end of the tenancy. Is this affected by the regulations?
  • Yes, it has to be dealt with just as if the tenant paid it herself. It is being paid on her behalf.
  • Can I make the tenant pay two months' rent in advance instead of taking a deposit?
  • It is not permissible to require rent to be paid before its due date, so this might well be regarded as a sham by the Courts, leaving you liable to the penalties for non-compliance with the regulations. In any event you would have to forgo the last month's rent and effectively do without a deposit.
  • Can I charge the tenant a higher rent, take no deposit, but offer to refund some of the rent at the end of the tenancy if he leaves the property in good order?
  • As in practice this has the same effect on the tenant as taking a deposit, the Courts might well view it as a sham, with no purpose other than to avoid the regulations. Consequently you risk the penalties for non-compliance. In addition, bear in mind that an AST tenant can, within the first six months of his tenancy, refer the rent to the Rent Assessment Committee, who may order it to be reduced if it is higher than the rents paid for similar properties in the area that are also let on ASTs. This could put you in the position of having to reduce the rent and still being obliged to refund part of it if the property is left in good condition!
  • Can I charge the tenant more rent instead of taking a deposit?
  • You could ask a higher rent in lieu of taking a deposit, but a tenant who knows he won't get a deposit back has less incentive to care for the property - in effect, you are assuming in advance that he will damage it and charging him accordingly. Some tenants may take care not to disappoint you! You may also put yourself at a commercial disadvantage by seeking a higher rent than is payable for other similar local property. In addition, bear in mind that an AST tenant can, within the first six months of his tenancy, refer the rent to the Rent Assessment Committee, who may order it to be reduced if it is higher than the rents paid for similar properties in the area that are also let on ASTs.
  • My tenant has paid me the deposit in cash and will want it back in cash at the end of the tenancy?
  • You will probably have to refuse, unless you pay to join an insurance scheme and hold the deposit yourself. The custodial scheme will not pay cash, and it is unlikely that any letting agent will agree to do so as it makes it difficult to comply with the regulatory regimes to which many are subject.
  • What if my letting agent holds the deposit but goes out of business before the end of the tenancy - I have heard that I would be liable to repay it to the tenant?
  • In principle that is and always has been correct - you are responsible if your agent defaults. An advantage of the new regulations is that if your agent holds the deposit, they must belong to one of the insurance schemes, which will pay out if they don't.
  • I am going overseas to work and will be letting my home while I am abroad. How do the regulations affect me?
  • In exactly the same way as a UK-resident landlord, although the insurance-based scheme aimed at private landlords will not accept landlords resident outside of the UK.
  • Are student lets affected by the new TDS regulations?
  • It depends on the nature of the letting. Hostels, halls of residence etc. owned by educational institutes may not be affected as the students are not usually Assured Shorthold tenants. If, as a private landlord, you let to students, you are probably creating ASTs and so you must comply.
  • My local authority pays deposits for some tenants. Is this affected?
  • If they actually pay you the deposit, you must comply in the usual way. If they provide a guarantee service which does not involve money being paid, the regulations do not apply.

There are two types of Tenancy Deposit Schemes, custodial and insurance-backed.( + expand info )

  • How does the Tenancy Deposit Scheme custodial scheme work?
  • Within 30 days of receiving the deposit, the landlord must pay the deposit to the scheme administrator to hold for the duration of the tenancy, and provide the tenant with prescribed information about the scheme, and how the return of the deposit will be dealt with. The scheme refunds the deposit to the tenant at the end of the tenancy when it has received confirmation from the landlord and tenant that there are no deductions to make.
  • How do the Tenancy Deposit Scheme insurance-backed schemes work?
  • The landlord retains the deposit but joins an insurance scheme. Within 30 days of receiving the deposit he must notify the scheme of the details of the tenancy, and must provide the tenant with prescribed information about the scheme, and how the return of the deposit will be dealt with. He returns the deposit at the end of the tenancy; if he fails to do so within the rules of the scheme, the scheme pays the tenant and recovers the monies from the landlord.
  • What if I want to change from an insurance scheme to the custodial scheme?
  • You must inform the insurance scheme administrator, who will give both you and the tenant not less than two months' notice of the date on which the deposit will be excluded from the scheme. He will also inform you and the tenant of the options available to you to ensure continued compliance with the regulations after that date - in effect, that you must join the custodial scheme within thirty days. The insurance scheme administrators will also follow this procedure if they terminate your membership of the scheme - for failing to follow their directions, for example, or for no longer meeting the conditions required for membership, or non-payment of fees.
  • What if I want to change from the custodial scheme to an insurance scheme?
  • You must inform the custodial scheme administrator, who will give both you and the tenant not less than two month's notice of the date on which the deposit will be released from the scheme. He will also inform you and the tenant of the options available to you to ensure continued compliance with the regulations after that date - in effect, that you must join one of the other schemes, and provide the tenant with the prescribed information about it within thirty days.
  • If I use one of the insurance schemes, who gets interest on the deposit?
  • This is governed by what is stated in the tenancy agreement. If nothing is stated and you hold the deposit, the tenant is entitled to it. If you hold it and the tenancy agreement states that no interest will be paid on it, you may retain any interest earned. If the letting agent holds the deposit, it is likely that they will hold it "as stakeholder" (to comply with the requirements of the insurance schemes) which means that they may keep any interest.
  • If I use the custodial scheme, who gets interest on the deposit?
  • The custodial scheme is funded by keeping some of the interest generated by the deposits it holds. Any surplus will be paid according to what is stated in the tenancy agreement. If there is no reference to either party being entitled to interest, the tenant will receive it. Otherwise surplus interest at a rate specified by the Government (currently Base Rate less 2.32%) may be paid to the landlord and tenant on the share of the deposit that they each receive.

The Tenancy Deposit Scheme affects all assured shorthold tenancies (AST) which started on or after 6 April 2007;( + expand info )

  • Which landlords are affected by the Tenancy Deposit Scheme?
  • All landlords of residential property in England or Wales that is let on an Assured Shorthold tenancy (AST). The regulations do not apply to Northern Ireland or Scotland, although it is likely that the Scottish Parliament will introduce similar provisions.
  • Which tenants are affected by the Tenancy Deposit Scheme?
  • All ASTs that start on or after 6 April 2007. Non-AST lettings such as company tenancies, assured tenancies, resident-landlord lettings, and personal tenancies with a rent exceeding £100,000 p.a. are not covered by the regulations.
  • What about deposits held by landlords in respect of ASTs already in existence?
  • Current fixed term ASTs that span 6 April 2007, or ASTs that are continuing on a periodic basis, are not affected. However, the landlord of an existing AST that is renewed or extended at some point after that date by means of a new tenancy agreement should comply with the regulations at that time.
  • My letting agent now insists on holding the deposit "as stakeholder", not just as my agent. Why?
  • The insurance schemes are always likely to require this because it means that the agent cannot release the deposit to either party without the other's agreement. It also means that the agent can keep any interest earned on the deposit. As letting agents like landlords have to pay if they want to join an insurance scheme, this is one way in which they may seek to recoup the cost.

The aim of the Tenancy Deposit schemes is to guarantee that tenants will get their deposits back at the end of the tenancy, if they meet the terms of the tenancy agreement and do not damage the property.( + expand info )

  • I have let to three joint tenants, two of them accept the deductions I want to make from the deposit, but the third doesn't?
  • This is a dispute over deductions like any other and has to be settled by reference to the ADR scheme or the Courts accordingly.
  • What if the landlord's claim for damages exceeds the amount of the deposit?
  • The schemes and associated ADR services only deal with the deposit itself. The landlord would have to take the tenant to Court to recover additional sums. If the landlord's claim has already been found by an ADR service to be fully justified, that is likely to help his case considerably in Court.
  • The tenant causes damage, the cost of which is covered by the deposit, but there are rent arrears as well - what if the landlord's total claim exceeds the deposit?
  • The schemes and associated ADR services only deal with the deposit itself. The landlord would have to consider taking the tenant to Court to recover additional sums. If the landlord's claim has been found by an ADR service to be fully justified, that is likely to help his case in Court. It will probably be better to concentrate on dealing with the damages by deductions from the deposit if possible (using the ADR service if they are disputed), leaving the excess of the claim over the deposit to be recovered as rent arrears through the Courts.
  • What if the tenant doesn't pay the last month's rent?
  • Provided that the tenancy agreement allows the deposit to be used to settle unpaid rent (most do), the landlord can claim this from the deposit in the same way as with damage caused by the tenant.
  • What if the tenant disappears without leaving any forwarding address?
  • Not less than 14 days after the end of the tenancy, the landlord can notify the scheme administrator of any claim that he wants to make on the deposit. He must supply a statutory declaration that the tenant cannot be contacted, as well as the usual details of his claim and evidence to support it, and whether he prefers the use the ADR service or the Courts to resolve any dispute, if the tenant does come forward. The scheme administrator then sends the declaration and details of the claim to the tenant, at the tenant's last known address. If there is no response after 14 days, the landlord's claim will be accepted in full by the scheme and the deposit may be retained or disbursed by the landlord or custodial scheme accordingly.
  • I have let to 3 joint tenants 1 of them wants to leave and has found a suitable replacement, but he wants a third of the deposit back?
  • Technically this amounts to a surrender of the existing tenancy and the creation of a new tenancy. It may be possible for the tenants to reach agreement amongst themselves for the incomer to reimburse the departing tenant and take over his right to some of the deposit, but if there is any doubt this should be treated as if the whole deposit is to be returned and new one paid.
  • I have let to 3 joint tenants and they will expect to receive a third of the deposit each at the end of the tenancy?
  • If you have let to them on a "joint and several" basis, as is usual, they cannot insist on this unless you agreed to do so in advance. If you use the custodial scheme, they will have to nominate a 'lead tenant' to act for them, and to whom the scheme will make one payment in respect of the deposit. It is then up to the tenants to divide up the payment as they wish.
  • Must I prepare a detailed inventory of my property and its contents to comply with the regulations?
  • It is not a legal requirement, but if the tenant disputes the deductions you want to make from the deposit, your chance of success (whether through the appropriate ADR or the Courts) is minimal without a detailed inventory and schedule of condition at the start and end of the tenancy. It is up to you to provide evidence that the damage occurred during the tenancy and was the fault of the tenant.

What is an ADR (Alternative Dispute Resolution) service?

ADR in relation to the tenancy deposit schemes was introduced by the Housing Act 2004 with important changes made by Housing (Tenancy Deposits) (Prescribed Information) Order 2007 (SI 2007/797));( + expand info )

  • When did ADR in relation to TDS begin?
  • The tenancy deposit scheme came into force on 6 April 2007.

All three deposit schemes offers an ADR service( + expand info )

  • What is the purpose of the ADR service?
  • ADR is a means of settling disputes without going to Court - each party's claim is considered by an independent assessor. Each of the three deposit schemes offers an ADR service that is free to landlords and tenants.
  • What if the tenant doesn't agree to the deductions that the landlord wants to make?
  • Either party can notify the relevant scheme administrator, not less than 10 working days after the end of the tenancy, that there is a dispute over the return of the deposit. The custodial scheme will not pay out any part of the deposit that is in dispute until the dispute is resolved. A landlord who has used an insurance scheme is required to pay any part of the deposit that is in dispute to the scheme to hold until the dispute is resolved.
  • The tenant causes damage, the cost of which is covered by the deposit, but there are rent arrears as well - what if the landlord's total claim exceeds the deposit?
  • The schemes and associated ADR services only deal with the deposit itself. The landlord would have to consider taking the tenant to Court to recover additional sums. If the landlord's claim has been found by an ADR service to be fully justified, that is likely to help his case in Court. It will probably be better to concentrate on dealing with the damages by deductions from the deposit if possible (using the ADR service if they are disputed), leaving the excess of the claim over the deposit to be recovered as rent arrears through the Courts.

Because participation in this ADR process requires consent by both parties, the final decision of the adjudicator is binding on both the landlord and tenant.( + expand info )

  • Are both parties obliged to use the Alternative Dispute Resolution if there is a dispute over the deposit?
  • No, either landlord or tenant can refuse to settle the dispute via the Alternative Dispute Resolutionservice, in which case it must be settled in Court
  • What if there is a dispute but either the landlord or tenant does not indicate whether he wants to use the ADR service, or go to Court; or simply does not respond?
  • Provided the scheme administrator is reasonably satisfied that the landlord or tenant has received the appropriate notices or documents from the scheme, but has chosen to ignore them, it will be treated as if he has agreed to the dispute being dealt with via the ADR service.
  • What if the landlord or tenant cannot be contacted at the end of the tenancy, but turns up later after the deposit has been paid out and disputes the basis on which this was done?
  • This would not be dealt with by the relevant scheme but through the Courts. The landlord or tenant would have to show that the statutory declaration and/or claim was false. If the Court agrees, the offending party could be liable to prosecution for perjury as well as for compensating the other.

Acquisition/Disposition of the Freehold on property

Which form is used to dispose of the Freehold on a property going to be sold subject to a tenancy?( + expand info )

  • Which form does a tenant use to buy a freehold interest in a property from a landlord?
  • HUD1. Where the tenancy was created under the Leasehold Reform Act 1967, a different form is used, usually L&T 50. (Where the tenant claims to be exercising a right under section 28(1)(b)(ii) of the Leasehold Reform Act 1967, form L&T 52 is used, but this is a less common situation).
  • Which form would a group of tenants in a block of flats use to acquire the Freehold interest in the entire building from their Landlord?
  • This is called a right of "collective enfranchisement" under the Leasehold Reform Housing and Urban Development Act 1993. Form HUD 6 should be used.