Tenancy Deposit Protection: Which Scheme to Choose in 2026

You must protect your tenant’s deposit in a government-approved scheme within 30 days of receiving it. Fail to do this and you cannot serve a valid Section 21 notice — plus the tenant can claim up to 3x the deposit in compensation. There are three schemes to choose from: DPS, MyDeposits, and TDS.

Custodial vs Insured: Which to Choose?

With a custodial scheme, the scheme holds the money. With insured, you keep the deposit but pay a fee to insure it. Most self-managing landlords prefer custodial — it’s free and simpler. Our first-time landlord checklist covers deposit protection alongside every other legal requirement.

What Happens at the End of the Tenancy?

If there’s no dispute, the deposit gets returned within 10 days. If there is a dispute, the scheme runs an adjudication process. Good inventories and check-in reports are essential. The Renters’ Rights Act keeps deposit protection rules largely intact, but changes how evictions work if you’ve made a compliance error.

Avoiding Common Deposit Mistakes

The biggest mistake is missing the 30-day deadline. The second is not serving the prescribed information. Both invalidate your Section 21 rights. If you’re self-managing, set calendar reminders and use a checklist every time.

Full guide coming soon.