Renters' Rights Act Deposit Rules for Landlords

Last updated: 8 October 2026 · Next review: April 2027

The money you take at the start of a tenancy — the holding deposit, the tenancy deposit and the first rent payment — is now more tightly regulated than ever. The core deposit protection rules haven’t changed, but the Renters’ Rights Act has added a new limit on rent in advance and made deposit protection a condition of regaining possession.

This guide sets out exactly how much you can take, when, and what happens if you get it wrong. It covers England and summarises official GOV.UK guidance and the Tenant Fees Act 2019 guidance for landlords.

Quick reference

Payment	Maximum	Key rule
Holding deposit	1 week’s rent	Refund within 7 days in most cases
Tenancy deposit (annual rent under £50,000)	5 weeks’ rent	Protect within 30 days
Tenancy deposit (annual rent £50,000 or more)	6 weeks’ rent	Protect within 30 days
Rent before the tenancy is agreed	Nothing	New under the Renters’ Rights Act
First rent payment after agreement	Up to 1 month’s rent (or 28 days for shorter periods)	New under the Renters’ Rights Act

Holding deposits

A holding deposit reserves the property while you carry out referencing. Under the Tenant Fees Act guidance:

it’s capped at one week’s rent;
the “deadline for agreement” is usually 15 days after you receive it, unless you both agree otherwise in writing;
you must refund it within 7 days of the tenancy being agreed, you deciding not to proceed, or the deadline passing — unless a retention reason applies.

You can only keep a holding deposit if the applicant gave false or misleading information that reasonably affects your decision, fails a Right to Rent check, withdraws, or fails to take all reasonable steps to enter into the tenancy.

Once the tenancy starts, the holding deposit can be refunded or put towards the tenancy deposit or first rent — and at that point, GOV.UK notes, it becomes a deposit that must be protected.

The tenancy deposit

How much you can take

The cap is five weeks’ rent if the total annual rent is below £50,000, and six weeks’ rent if it’s £50,000 or more.

Example: for a property let at £1,200 a month, the annual rent is £14,400 and weekly rent is about £276.92 (£14,400 ÷ 52). The maximum deposit is 5 × £276.92 = £1,384.62.

Protecting it

According to GOV.UK, you (or your agent) must:

put the deposit in a government-approved tenancy deposit protection scheme within 30 days of receiving it; and
give the tenant the required prescribed information about the scheme and the deposit.

The three government-backed schemes are the Deposit Protection Service, MyDeposits and the Tenancy Deposit Scheme. Some offer a custodial (free) option where the scheme holds the money, and insured options where you hold it and pay a fee.

At the end of the tenancy

You must return the deposit within 10 days of agreeing with the tenant how much they’ll get back. If you disagree about deductions, the deposit stays protected in the scheme until the dispute is resolved, and the schemes offer free dispute resolution.

What happens if you don’t protect a deposit

The consequences are serious and, since the Renters’ Rights Act, harder to escape:

Court orders: if the tenant applies to court, it can order you to repay the deposit or pay it into a custodial scheme within 14 days, and order you to pay the tenant up to three times the deposit within 14 days, according to GOV.UK.
Possession: GOV.UK’s Renters’ Rights Act guidance confirms that deposit protection is now required to use most possession grounds. An unprotected deposit can stop you regaining your property.
No time limit: tenants can bring a claim at any time during the tenancy.

On a £1,385 deposit, a three-times award would be over £4,150 — before legal costs and the delay to any possession claim.

Rent in advance: the new rules

This is the biggest change for landlords who used to ask for several months’ rent up front to manage risk.

Before the tenancy is agreed: GOV.UK states you cannot ask for, encourage or accept any payment of rent. The NRLA points out that even a voluntary payment at this stage is a breach.

After the tenancy is agreed, before move-in: the NRLA explains you can ask for up to one month’s rent (or 28 days where the rental period is shorter than a month) as the first payment. Contract clauses requiring more are void.

During the tenancy: you can only require rent to be paid for the rental period it relates to. Because rental periods can’t be longer than a month, you can’t require rent months in advance.

These rules apply to tenancies entered into on or after 1 May 2026. If a tenant chooses to pay early voluntarily after the tenancy starts, that’s their choice — but you can’t make it a condition.

What this means for you

Many landlords relied on rent in advance for applicants with limited credit history, overseas applicants or the self-employed. That option has gone. Alternatives include a UK-based guarantor, stronger referencing, or rent guarantee insurance — though most rent guarantee policies require the tenant to pass referencing.

Other payments you can and can’t charge

Under the Tenant Fees Act, the only payments you can require from tenants are rent, a capped tenancy deposit, a capped holding deposit, and certain defined charges, including:

a change to the tenancy requested by the tenant (up to £50, or reasonable costs if higher);
early termination requested by the tenant (limited to your actual loss);
default fees for late rent (more than 14 days late) or lost keys;
utilities, council tax and communication services where the tenancy makes the tenant responsible.

Fees for referencing, inventories, check-in or admin can’t be charged to tenants.

Penalties for breaching the fee and deposit cap rules

The Tenant Fees Act guidance sets a civil penalty of up to £5,000 for a first breach, with a repeat breach within five years a criminal offence (or a civil penalty of up to £40,000 as an alternative to prosecution). Industry guidance on the Renters’ Rights Act reports civil penalties of up to £7,000 for many breaches and £40,000 for serious or repeated ones. Tenants can also recover unlawfully charged fees.

Checklist for landlords

Holding deposit no more than 1 week’s rent; deadline for agreement in writing
Tenancy deposit no more than 5 weeks’ rent (6 if annual rent ≥ £50,000)
Deposit protected within 30 days in DPS, MyDeposits or TDS
Prescribed information given to the tenant
No rent taken before the tenancy is agreed
No more than one month’s rent taken up front after agreement
No referencing, admin or inventory fees charged to tenants
Deposit returned within 10 days of agreeing deductions

Worked example: the money at the start of a tenancy

A flat let at £1,200 a month (annual rent £14,400) under the rules for tenancies from 1 May 2026:

Stage	Maximum you can take	Amount
Holding deposit (while referencing)	1 week’s rent	£276.92
Tenancy deposit	5 weeks’ rent	£1,384.62
Rent before the tenancy is agreed	Nothing	£0
First rent payment once the tenancy is agreed	1 month	£1,200.00

If the holding deposit is put towards the first month’s rent or the deposit, the tenant pays the balance. The most the tenant can be asked for in total before moving in is therefore about £2,585 (deposit plus first month’s rent). Under the old approach, a landlord asking for six months up front would have collected £7,200 in rent alone.

Deposit deductions: what you can claim for

At the end of a tenancy you can propose deductions from the deposit for things such as unpaid rent, damage beyond fair wear and tear, cleaning to return the property to its check-in condition, and missing items. The tenant must agree, or the deposit scheme’s dispute service decides. Good evidence wins disputes:

a detailed check-in inventory with dated photos, signed by the tenant;
a check-out report with matching photos;
invoices or quotes for any work claimed;
records of rent owed.

Fair wear and tear — the normal deterioration from everyday living — can’t be charged to the tenant. Older carpets and decoration naturally wear out over time; claims should reflect the age and condition of items at the start of the tenancy, not the cost of brand-new replacements.

Existing tenancies from before 1 May 2026

The rent-in-advance rules apply to tenancies entered into on or after 1 May 2026. Deposits taken under earlier tenancies should already be protected; if you’re unsure, check with your scheme now. Because an unprotected deposit can block most possession claims under the Renters’ Rights Act, fixing any historic problem is worth doing before you ever need to regain possession.

Frequently asked questions

How much deposit can a landlord charge in 2026? Five weeks’ rent if the annual rent is under £50,000; six weeks’ if it’s £50,000 or more.

Can I still ask for rent in advance? Not before the tenancy is agreed. After it’s agreed, you can ask for up to one month’s rent up front for tenancies from 1 May 2026.

How long do I have to protect a deposit? 30 days from receiving it, with the prescribed information given to the tenant.

What if I forgot to protect a deposit? Take advice quickly. A tenant can claim at any time during the tenancy, and an unprotected deposit can block most possession claims.

Do I need to protect a holding deposit? Not while it’s a holding deposit. Once the tenancy starts and it becomes a deposit, it must be protected.

Sources

This article summarises official guidance and is not legal advice. Last checked: 8 October 2026.

Related guides

Figures are published examples, estimates and averages, not quotes. Rules change: check the linked official source before you act.

About this guide: written and edited by the LandlordCosts Team. We are not solicitors, accountants or insurance brokers; every figure is linked to its source. Read how we research costs, our editorial policy and more about us.