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Deposit deductions at the end of a tenancy: what landlords can (and cannot) keep in 2026

Updated July 2026 · Applies to England · 6 minute read

The deposit is the tenant's money until you can prove otherwise. That single principle decides almost every end-of-tenancy dispute in England, and it catches out more landlords than any other part of letting. The Renters' Rights Act, in force since 1 May 2026, left the deposit-deduction rules untouched - but now that Section 21 is gone, sloppy deposit handling costs you more than ever. Here is exactly what you can keep at the end of a tenancy, what you cannot, and how to come out on top if it reaches adjudication.

What you can deduct

A deposit exists to cover genuine loss, not to top up your return. You can make a deduction for:

Every deduction has to clear the same two tests: it must be reasonable, and it must be evidenced. A figure plucked from the air will not survive a challenge.

What you cannot deduct: fair wear and tear

Fair wear and tear is the gradual, expected decline that happens to any home simply because people live in it. Faded paintwork, a thinning patch on a hallway carpet, light scuffs on a wall, a lock that has stiffened after three years of daily use - none of these can be charged to the tenant. A longer tenancy or a larger household fairly produces more wear, not less. You are entitled to get the property back in the condition it was let, minus the honest effects of time - not "as new" at the tenant's expense.

The betterment trap: why "new for old" fails

This is where good claims fall apart. If a tenant ruins a seven-year-old carpet, you cannot deduct the cost of a brand-new one. That would leave you better off than before - "betterment" - and adjudicators strip it out. Instead you claim the value of the remaining useful life the damage cost you. If that carpet had two years left in a ten-year life, you claim roughly a fifth of its replacement cost, not the whole thing. Adjudicators work to rough lifespans as a starting point:

ItemTypical useful lifeWhat you can claim
Carpets and flooring5 - 10 yearsA share reflecting the life the damage cut short - never the full replacement
Paint and decoration3 - 5 yearsRedecoration only where damage goes well beyond marks and scuffs
Curtains and blinds5 - 7 yearsProportion of remaining life, adjusted for age at check-in
White goods8 - 10 yearsRepair cost, or a depreciated share if replacement is genuinely needed
Upholstered furniture7 - 10 yearsDepreciated value, not the price of a new item

These are guides, not fixed rules - quality and use shift them - but they show why a full new-for-old claim almost never holds up.

The evidence that wins

Adjudication is decided on documents alone. Nobody visits the property and there is no hearing - the adjudicator reads what each side submits and decides, on the balance of probabilities, whether your claimed loss is down to the tenant. Your case rests on:

If you cannot agree: free scheme adjudication

The DPS, MyDeposits and TDS all offer a free dispute-resolution service, almost always better than court. Either side can refer the dispute; the scheme holds the disputed sum while an independent adjudicator reviews the evidence and issues a binding decision. The starting point is always that the deposit belongs to the tenant, so the burden sits with you to justify every penny. Once you and the tenant agree a figure - with or without adjudication - the deposit, or the undisputed part of it, must be returned within 10 days.

The commonest reason landlords lose is a missing or unsigned check-in inventory. If you cannot prove the condition at the start, you cannot prove the tenant changed it - and a professional-cleaning clause on its own is void under the Tenant Fees Act. Document the start of every tenancy as carefully as the end.

Start every tenancy on solid ground

Deductions are only as strong as the paperwork behind them. Our Tenancy Agreement Pack gives you a Renters' Rights Act compliant agreement with clear condition, cleaning and inventory obligations built in - the foundation every fair deduction stands on. £29, one-off, delivered instantly as PDF and Word.

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Frequently asked questions

Can I insist on a professional clean? No. Under the Tenant Fees Act you cannot make professional cleaning a condition of the tenancy, and trying to enforce one risks a penalty of up to £5,000. You can still deduct the reasonable, evidenced cost of cleaning the property back to its check-in standard.

Can I keep the whole deposit if the tenant leaves owing rent and damage? Only up to your proven loss. If the arrears and evidenced deductions come to less than the deposit, the balance must go back to the tenant.

How long do I have to return the deposit? Within 10 days of you both agreeing how much is returned. Most schemes also ask you to respond to a tenant's written request within 10 days before they can raise a dispute.

Does the Renters' Rights Act change any of this? No. The deposit cap, the wear-and-tear framework and the free adjudication service are all unchanged - but with Section 21 gone, an unprotected deposit now blocks almost every possession ground, so get the basics right from day one.

This guide is general information for landlords in England, not legal advice for your specific circumstances. Deposit-scheme rules and timescales vary slightly - check your scheme's guidance before making or disputing a deduction.

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