How Long Does a Landlord Have To Make Tenancy Deposit Deductions?

In England and Wales, landlords need to return tenancy deposit deductions within 10 days of agreeing how much should be returned. The end of the tenancy can be busy for landlords, but it’s important to react quickly. Priority tasks include inspecting the property, comparing its condition against the original inventory and deciding whether the tenant’s deposit should be returned in full.

As a landlord, the topic of deposit deductions will come onto your radar as a tenancy ends. You don’t have long to identify any issues with your property before deciding to make deductions or return the deposit in full. 

If you note missing items or damage beyond fair wear and tear, you may be able to propose tenancy deposit deductions. This guide will explain how long landlords have to make tenancy deposit deductions and what they need to do from the checkout inspection through to agreement or dispute.

How Long Does a Landlord Have to Claim Damages?

For properties in England and Wales, landlords should generally inspect the property and communicate any proposed deductions during the first 10 days after the tenancy ends. It’s important to note that the 10-day deadline does not start on the day the tenancy ends. Instead, it starts when the deduction has been made and agreed by both parties.

However, landlords should assess the property as soon as possible. They should use the inventory list made at the start of the tenancy and compare the current situation to work out whether or not tenancy deposit deductions are required. Any delays could actually make it harder for the landlord to provide evidence that the damage occurred during the tenancy and may increase the chances of a dispute. In brief, you should:

1. Arrange the checkout inspection as soon as the tenant leaves.
2. Compare the property with the original inventory.
3. Collect evidence of any damage, cleaning issues or missing items.
4. Calculate a fair deduction.
5. Send the tenant an itemised breakdown in writing.
6. Begin the deposit repayment process through the relevant scheme.

Our guide to tenancy deposits explains how deposits should be protected and managed throughout a tenancy.

If landlords intend to make a deduction, they should discuss it promptly with the tenant. During this time, the deposit must remain protected. The landlord should not deliberately delay the process by failing to communicate or refusing to provide evidence. Once an agreement has been reached, the payment should be made within ten days.

What Can Landlords Deduct from Deposit?

As a landlord, you must outline any reasons for end of tenancy deposit deductions in the tenancy agreement. Setting clear standards from the outset could save you in the event of a dispute. Some common reasons for landlords to deduct from the deposit include:

Unpaid rent 

If your tenant still owes you rent money at the end of their tenancy, you can deduct this from their deposit. In some cases, the amount that the tenant owes can be more than the full deposit. To make sure you’re not out of pocket, you could take the case to court to claim back the rest. However, you need to consider the legal fees of going to court. It may not be worth your time and money if it means you’ll make a further loss.

Property damage

Landlords can deduct the amount required to repair damage to the property. What is defined as damage can be a grey area, as you cannot charge tenants for fair wear and tear. For example, you cannot make deductions based on small scuffs on the wall or faded paintwork. Whereas you could apply charges if you see holes in the walls or large burns on the kitchen worktop.

Remember to take the length of the tenancy and the number of occupants into consideration when evaluating the property damage to give the fairest assessment. Or else your tenants may begin to dispute the deposit deduction.

Damage by pets 

Allowing pets into your rental property can be risky, so it may be worth charging a higher deposit to start with. Again, this should be clearly stated in the tenancy agreement and your tenants must understand their responsibility to leave the property in the same condition that they found it.

Deposit deductions due to damage by pets can relate to anything big or small; from the cost of replacing woodwork after a cat has scratched it to the expense of removing an infestation. Remember to get a reliable quote before you decide how much to deduct.

Deposit deductions for cleaning

Deposit deductions for cleaning can be one of the most common culprits. You shouldn’t demand that your tenant hire professional cleaners for a deep clean, but if the property is in a worse state than how you handed it over, it’s acceptable to make a deduction.

Lost items that are owned by the landlord

You may have left items in your property for your tenants to use. This can range from furniture to ironing boards to a cutlery set. When you carry out your final property inspection, have your inventory to hand. Carefully work through your list, and if any items are missing, it is acceptable for you to deduct the cost of a replacement.

Poor redecoration

Most tenants will need permission from their landlord before they make any home improvements, and major redecoration is often granted for longer tenancies. However, you can make deposit deductions if your tenants did a shoddy job and you’ll have to go in to put it right. The cost of buying materials and bringing in decorators can soon add up, so get a quote from a professional to send over with your deductions document.

Bear in mind that you can’t withhold your tenant’s deposit simply because you feel like redecorating the property. There must be a clear reason for your proposed actions. Some common reasons to redecorate overlap with property damage. For example, your tenants may have left holes in the wall from where they hung pictures, or there could be large scratches on the wooden floor that need to be replaced. To avoid disputes around end of tenancy deposit deductions about this point in particular, landlords and tenants should communicate throughout the tenancy.

Lack of maintenance of key facilities

Deductions for lack of maintenance are also a vague area. But you can charge your tenants if you feel that they have neglected parts of the property, such as appliances. Or perhaps they left the window open during a storm, which allowed floods of water to damage the property. Although the tenant did not have malicious intent to damage the property, you can still make deductions for this kind of negligence.

Tenant leaves unwanted belongings 

The main message has been that if your property isn’t in the same condition at the end of the tenancy as at the start, you can probably make a deposit deduction. This also applies to the cost of removing the tenant’s belongings that they left behind. You should give your tenant a chance and ask them to remove the items themselves, but if you cannot come to an agreement, it’s acceptable to make a small deduction.

How Much Can Tenancy Deposit Deductions Be?

If you decide to make tenant deposit deductions, it’s a good idea to give your tenant a breakdown of the costs involved. This transparency should deter any disputes, and both parties can come to an agreement sooner.

The deductions that you make should be fair, so be realistic about the finances you’ve lost during their tenancy. For example, if your tenants damaged a cheap sofa, don’t charge them for the cost of a higher spec three-piece suite. You should find the price of a like-for-like replacement and charge them accordingly.

End of Tenancy Deposit Deductions: A Step-by-Step Timeline

By following the step-by-step process below, landlords can avoid delays and provide stronger evidence if a dispute occurs.

Step 1: Confirmation of End of Tenancy

Follow the usual end-of-tenancy steps. Make sure the tenant has moved out of the property and returns the keys. The landlord cannot start the process before this point as the tenancy is ongoing.

Step 2: Complete the Checkout Inspection

Landlords should visit and inspect the property as soon as they possibly can. Take your check-in inventory with you so you can compare the property’s condition before the tenancy (and, in some cases, during) with now. You should have included photographs in the inventory. It’s important to try and take the same photographs again from the same angle.

Step 3: Work Out if it’s Fair Wear and Tear

Consider whether each change was caused by normal everyday use or by misuse, negligence or an accident. Remember to account for the length of the tenancy and the condition of the property when the tenant moved in. You cannot apply tenancy deposit deductions for fair wear and tear.

Step 4: Work Out Costs and Supporting Evidence

Get quotes, invoices or reasonable estimates for any necessary cleaning or repairs. Landlords must not inflate the price or choose a more expensive solution when a cheaper repair would achieve a like-for-like result.

Step 5: Inform the Tenant of Tenancy Deposit Deductions

Explain each proposed deduction separately in a written format.

The breakdown should include:

• What the deduction is for
• Which tenancy term has been breached
• The amount requested
• How the amount was calculated
• The evidence supporting the claim
• Any allowance made for age or fair wear and tear

Clear communication can help both parties reach an agreement before a formal dispute is needed.

Step 6: Return The Agreed Amount

Once the landlord and tenant have agreed how the deposit should be split, the tenant’s share should be returned within 10 days.

As well as providing advice for landlords, such as answering key questions like how long does a landlord have to claim damages, CIA Landlords can help you compare landlord insurance. Appropriate cover may protect you against risks including damage, theft and loss of rent, depending on the terms and exclusions of the policy. Get a quote today or contact our team for more information.