Holding Deposit Rules — landlord obligations in England
When you take a holding deposit, the amount is capped at one week's rent. You cannot accept a new holding deposit for the same property if a previous one has not been repaid (unless a Schedule 2 exception applies). You must repay the deposit within 7 days of a trigger event (e.g., tenancy starts, you decide not to proceed, or a deadline passes). If you decide to retain the deposit (because the tenant withdraws or fails a right to rent check), you must give written notice within 7 days explaining which exception applies.
The law that creates this obligation
Your obligations as a landlord
- Who this applies to: All landlords who take a holding deposit.
- When it applies: When requiring or receiving a holding deposit; repayment and notice deadlines apply after the trigger event.
- What you must do: Keep a record of the holding deposit receipt, a repayment record (if repaid within 7 days), or a retention notice (if retaining, explaining the Schedule 2 exception).
What good evidence looks like
Your compliance file should contain
- Written record or document confirming this obligation has been met
- Date of compliance — email timestamp, signed receipt, or platform log
- Remind 2 days before the 7-day deadline after the trigger event (e.g., tenancy start or decision not to proceed).
Upload the holding deposit receipt, and if applicable, the repayment record within 7 days or the retention notice within 7 days.
Record this obligation in your LettingsLedger workspace
Upload evidence, set reminders, and build a timestamped compliance record — all in one place.
Consequences of non-compliance
Failure to repay or give notice within 7 days makes the deposit a prohibited payment. The tenant can demand repayment, and you may face enforcement action by trading standards.
Further reading for landlords
LettingsLedger is a compliance evidence governance platform. It is not a legal services provider and does not provide legal advice. Content is derived from UK primary legislation at legislation.gov.uk and official GOV.UK sources. Reflects the position as at June 2026. A GovProtocol product by Pertheo Limited.