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When everyone has a home

Housing advice for Northern Ireland

Taking deposits

This page is for landlords operating in Northern Ireland.  You can find advice for tenants elsewhere on our website. Private landlords in Northern Ireland can get advice by calling 028 9024 5640 and choosing option 5. 

If you take a deposit for a private tenancy on or after 1 April 2013 you will be legally obliged to protect this deposit in an authorised scheme. You can choose to protect the deposit in either a custodial or insurance based scheme and 3 separate companies have been appointed to provide this service in Northern Ireland.

Deposits taken before the 1 April 2013 do not need to be placed in a protection scheme, but should be kept in a separate account and clearly labelled with the name of the tenant. Keep clear records about when you received the deposit and provide your tenants with a receipt. 

The Housing Amendment Act (NI) 2011 introduced a legal requirement for any deposits taken as part of a residential tenancy to be registered with a tenancy deposit protection scheme. This requirement will apply to any deposits taken on or after 1 April 2013. Find out more about the requirements and appointed scheme administrators.

The custodial scheme is free for both landlords and tenants to use. There are strict time limits within which you must give the scheme administrator the deposit and a list of prescribed information. You must also provide the tenant with a list of required information within a set time limit. Failing to protect the deposit or provide the current information can lead to a fixed penalty or prosecution. Find out more about the requirements of the Custodial Scheme.

If you use the insurance based scheme you'll be able to hold on to the deposit but will have to pay a fee to the scheme administrator. You will also be subject to strict time limits for registering the deposit and giving prescribed information to the scheme administrator and the tenant. Like the custodial scheme penalties will apply if you fail to act within the required timeframe. Find out more about the requirements of the Insurance based Scheme.

A security deposit belongs to a tenant. You should look at this money in the same way that you would an insurance policy. You have no right to the money unless you have suffered a financial loss which was caused by the tenant failing to do something that he or she was contractually or legally obliged to do.

If, at the end of the tenancy, you and your tenants are unable to agree on how to refund the deposit you will be referred by the scheme administrator to a Dispute Resolution Service. The adjudicator will look at the evidence and decide how the money should be returned. Find out more about adjudication and how to avoid disputes.

If you and the tenant cannot agree with how the deposit money should be returned, the tenants may take legal action against you in the Small Claims Court. You should try to resolve the issue outside of court, if you can.