From 6 April 2007, all deposits taken by landlords must be protected by a government-authorised tenancy deposit protection scheme.

The Government has awarded contracts to three companies to run tenancy deposit protection schemes:

The Deposit Protection Service (The DPS)

The DPS is the only custodial deposit protection scheme, is free to use and open to all Landlords. The service is funded entirely from the interest earned from deposits held. Landlords will be able to register and make transactions online. Paper forms will also be available should internet access be an issue. The scheme will be supported by a dedicated call centre and an independent dispute resolution service.

For more information, visit the website www.direct.gov.uk/tenancydeposit  or telephone 0870 707 1 707.

Tenancy Deposit Solutions Ltd (TDSL)

TDSL is a partnership between the National Landlords Association and Hamilton Fraser Insurance. This insurance-based tenancy deposit protection scheme enables landlords to hold deposits.

For more information, visit the website www.direct.gov.uk/tenancydeposit  or telephone 0871 703 0552.

The Tenancy Deposit Scheme (TDS)

TDS is an insurance-backed deposit protection and dispute resolution scheme run by The Dispute Service that builds on a scheme established in 2003 to provide dispute resolution and complaints handling for the lettings industry. The new scheme enables landlords to hold deposits.

For more information, visit the website www.direct.gov.uk/tenancydeposit  or call 0845 226 7837.

If the scheme is not complied with the Landlord is not entitled to use a 'notice only' method of regaining possession (under Section 21 of the Housing Act 1988 as amended by the Housing Act 1998 ) from the tenant until the deposit has been protected under an approved scheme.

The above punishments and penalties will apply to each and every Assured Shorthold Tenancy and each and every deposit that is not protected.