Three of the tenancy deposit operators in England and Wales have made formal bids to run a tenancy deposit protection scheme in Scotland.
Custodial operation Deposit Protection Scheme has applied, as has a consortium called Safe Deposits (including The Dispute Service, Scottish Landlord, Agent and Tenants organisations) and finally the third insurance-backed deposit scheme.
In Scotland, only custodial schemes, which physically bank tenants’ money, will be allowed to operate.
Under Scottish law, private residential landlords, and letting agents who take a deposit from their tenants on behalf of their landlord clients, will be required to lodge the deposit with a government-approved tenancy deposit scheme for safekeeping for the duration of the tenancy. The service will be free for landlords, agents and tenants.
The rules in Scotland will be slightly different from those south of the border.
Once the first tenancy deposit scheme goes live in Scotland, landlords and agents who take new deposits from tenants after this point will have 30 days, rather than 14, to lodge the deposit with a scheme.
Scottish landlords with existing tenancies will also have to lodge the deposit, but will have up to nine months to do so after the legislation goes live.