Deposit Deductions at the End of a Tenancy: What Is Fair and What Is Not

Deposit disputes are one of the most common flashpoints at the end of a tenancy because both sides often feel they are being reasonable.

Tenants may believe they left the property basically fine. Landlords may feel the property has been handed back below the standard in which it was let. The problem is that basically fine is not a standard. Evidence is.

In Scotland, a tenancy deposit can usually be up to 2 months’ rent, and in most cases it must be protected in an approved tenancy deposit scheme within 30 working days of the tenancy starting. When the tenancy ends, the deposit scheme returns the money unless deductions are proposed, and disputes can be referred to the scheme.

The key point is this: a landlord cannot use the deposit to make a property better than it was at the start of the tenancy. Deductions should not be made for fair wear and tear, for repairs that are the landlord’s responsibility unless the issue was made worse by not being reported, or for brand new replacements where that is not justified. A carpet stain, for example, may justify the cost of cleaning, but not automatically the full cost of a replacement carpet.

Where deductions are often fair is where there is clear evidence of poor cleaning, missing items, damage beyond normal use, rubbish left behind or unpaid rent.

For tenants, the best protection is to leave the property clean, photographed and properly handed over. For landlords, the best protection is a proper inventory, a fair check-out process and a calm, itemised breakdown of any proposed deduction. That is normally what separates a manageable deposit conversation from a bitter one.

Official sources and further reading:

• mygov.scot – Paying a deposit as a private tenant
• mygov.scot – Taking a deposit as a private landlord
• Shelter Scotland – Getting your deposit back