Tenancy deposit protection schemes

Tenancy deposit protection schemes can either be custodial or insurance-backed, each having their own terms and conditions.

This content applies to England


A  tenancy deposit protection scheme will:[1]

  • safeguard deposits paid in connection with assured shorthold tenancies, and

  • resolve disputes regarding the return of deposits at the end of the tenancy

Custodial schemes

With a custodial scheme, the deposit is paid by the landlord into an account held by the approved scheme administrator. This amount is held by the scheme until the end of the tenancy. The deposit is then returned (less any amount agreed to be paid back to the landlord in respect of damages, unpaid rent, etc.) to the tenant.[2]

There is no requirement for any interest accumulated on the deposit to be repaid to the tenant or landlord.

Insurance-backed schemes

With insured schemes, the landlord retains the deposit for the duration of the tenancy, but pays a premium to the scheme administrator to cover against the possibility that the landlord may default on returning the agreed amount at the end of the tenancy. In addition, at the end of the tenancy the landlord undertakes to pay back any disputed amount, if so required by the scheme administrator.[3]

Scheme administrators

There are three approved scheme administrators which, with effect from 1 April 2016, all provide both custodial and insurance-backed services:[4]

Each scheme has its own terms and conditions, as well as differing rules about who can join the scheme, return of the deposits at the end of the tenancy, alternative dispute resolutions, and change of tenant and/or landlord during the tenancy

Capita Tenancy Deposit Protection - now closed

The Capita Tenancy Deposit Protection was an insurance-backed scheme launched on 1 April 2013 and is now closed.

The scheme operated only for a few months and stopped accepting new deposits from 14 September 2013.

MyDeposits took over responsibility for all deposits previously protected by Capita from 1 December 2013 and reissued new deposit protection certificates and relevant information for tenants. Such deposits continued to be protected throughout the duration of the fixed-term tenancy, and where applicable beyond, under the rules of MyDeposit.

All affected landlords, agents and tenants should have been notified in writing.

Last updated: 17 March 2021


  • [1]

    s.212(2) Housing Act 2004.

  • [2]

    para 3, Sch.10 Housing Act 2004.

  • [3]

    para 5, Sch.10 Housing Act 2004.

  • [4]

    The current agreements between the approved scheme administrators and the government are effective from 1 April 2013. Until 1 April 2016, MyDeposit and TDS only provided insurance-backed services, but were then awarded contracts to run also custodial schemes.