Can I use my tenancy deposit to pay my rent?

We’ve had a number of questions about tenancy deposits and if they can be used if you’re struggling to pay your rent right now, so we asked someone who specialises in the field: John King, from Tenancy Deposits Scheme (TDS).

TDS is a government-approved deposit protection organisation, and their role is to make sure tenants’ deposits are handled securely and fairly.

My landlord has agreed to a discounted rent due to coronavirus, will they be able to take what they’ve discounted from my deposit at the end of the tenancy?

This will depend on the agreement you have reached. If the discount is a permanent one, or one that is in place for a set number of months, then no, they will not be able to deduct the discount from the deposit.

If, however, the agreed discount is actually a temporary deferral of part of the rent, meaning that you’ve agreed to pay less rent for a certain time, and repay what has been discounted in the future, then it’s possible that any unpaid balance could be deducted from the deposit at the end of the tenancy.

READ MORE: Can essential moves still take place

This is why it’s very important to keep written evidence of any agreements and arrangements. If TDS were to get involved in a dispute, they would rely heavily on those.

Because of the stay at home restrictions, both parties can’t be there for check-in and to go over the inventory. What happens?

TDS accepts things will have to be done differently right now. But actually, both parties are not required to be there in person for check-in, though often it is considered good practice to do so.

As long as the tenant receives a written copy of the inventory (the document describing the state of the property, and the contents in it), and is given enough time – usually seven days – to make any amendments to it, it shouldn’t be a problem if a tenant and landlord or agent can’t meet in person.

I passed my credit referencing and signed the tenancy agreement but haven’t moved in yet. I have since lost part of my income, so is the agreement still valid?

If the tenancy agreement has been signed, you have entered a contract, and that contract is still binding in spite of the change in circumstances. In the same way that the landlord couldn’t simply decide to pull out of the agreement because of a change in their situation, neither should you.

However, arrangements can be made, and both parties can work together to amend an existing agreement in light of sudden changes to circumstances.

As long as the agreement is mutual, it’s fine to make changes. In fact, it’s recommended that you speak with your landlord or agent as early as possible if your circumstances have changed or if you are struggling because of coronavirus.

Can I use my deposit to pay rent arrears or to pay my last rent?

This can be agreed on, but the landlord will need to accept that if the deposit is used for this purpose, there will be less or none of it left to claim for other reasons, such as damaged property, cleaning, etc.

As with everything else, make sure you keep written copies of any agreements such as these, in case you ever need it.

READ MORE: What should I do if I can’t pay my rent?

I’m moving out, but my landlord can’t come to the property for the final check-out and inventory inspection. How will my deposit be released?

Firstly, keep in mind that only essential moves should be taking place right now.

Normally, it is best to do the check-out immediately, at the end of the tenancy. However, this may not be possible right now, so TDS are allowing the option of delaying check-out by up to four weeks from the tenancy end date.

This would mean the landlord could come to inspect the property before releasing the deposit up to four weeks after you’ve moved out.

TDS acknowledges that this is not ideal, and they would rather landlords work with tenants to use tools such as video and photos to show the state of the property before leaving.

A ‘virtual tour’ done by the tenant can help the agent/landlord determine, in a general sense, if the property is reasonably clean and tidy, and hopefully would suffice in most cases.

Once again, documenting everything is really important.

What is a deposit protection scheme?

This is the security deposit that you pay at the beginning of the tenancy, which is usually 4-6 weeks’ worth of rent (capped at five weeks in England and Wales for rents upto £50,000 per annum. Scotland’s cap is two months’ rent, and Northern Ireland does not have an enforced cap).

Landlords and lettings agents are required to register the deposit with a scheme such as TDS.

That’s because, if at the end of the tenancy there are any disputes about potential deductions to be taken from the deposit, it won’t be just between you and the landlord.

TDS (or an equivalent) will act as a mediator, or judicator, in the process. It’s for your and the landlord’s protection and peace of mind.

Note: the advice given by TDS is based on legislation applicable in England and Wales. Scotland and Northern Ireland have their own regulations.

TDS says that although they are still operating normally (mostly), some things may take a little more time than usual, and there may be some delays in deposit returns. So bear that in mind.

Lastly, make sure that before you pay your deposit, you find out from the agent or landlord that they are registered in a deposit protection scheme (all schemes provide some form of certificate) and that you know which one it is, in case you ever need to contact them.