Tenancy deposits under the Renters' Rights Act 2025

From 1 May 2026, the Renters’ Rights Act 2025 (RRA 2025) amends the tenancy deposit protection rules in Chapter 4 of Part 6 of the Housing Act 2004 to align with the post-reform assured periodic tenancy regime.

Deposit rules apply to assured tenancies (not just “shorthold”)

RRA 2025 replaces references to “shorthold tenancy” with “assured tenancy” across the deposit scheme provisions (notably sections 212–214, and related wording in Schedule 10).

So deposit protection is no longer framed as an AST-only issue. It is an assured tenancy compliance requirement.

Main practical change: deposit non-compliance can block possession orders

RRA 2025 replaces Housing Act 2004 section 215 with a new “Sanctions for non-compliance” provision, reflecting the abolition of section 21.

The new test

Where a deposit has been paid in connection with an assured tenancy (including one that used to be an AST), the court may make an order for possession only if:

• the deposit is held in accordance with an authorised scheme; and
• the scheme’s initial requirements that fell to be complied with on receipt have been complied with (even if late); and
• the landlord has complied with the prescribed information requirements (even if late).

There are exceptions (below).

The practical shift is this: the problem is no longer “you can’t serve section 21”. It becomes “you may not be able to get a possession order on most grounds until the deposit position is fixed”.

Late protection: how late is still “in time” for possession?

For possession purposes, the new section 215 makes clear that compliance with the scheme initial requirements can be achieved even if it happens outside the 30-day limit.

So the latest point you can protect the deposit (and do the prescribed information steps) and still be entitled to possession is:

Any time up to the point the court makes the possession order.

Important: this does not remove or reduce financial penalties for late/non-compliance. It just means late compliance can still lift the possession bar. (Penalties are a separate issue.)

Exceptions: when the deposit bar does not apply

The new section 215 contains two key sets of exceptions.

A) Certain grounds are excluded

The possession restrictions in new section 215 do not apply to an order for possession made on the anti-social behaviour grounds:

• Ground 7A, or
• Ground 14

in Schedule 2 to the Housing Act 1988.

B) Returning the deposit / resolving a section 214 claim

The possession restrictions also do not apply where:

• the deposit has been returned to the tenant in full, or with agreed deductions; or
• a county court application under section 214(1) has been determined, withdrawn, or settled.

If the deposit is returned (or the deposit dispute is resolved through the court process), the deposit-related possession bar falls away.

Quick checklist for possession cases (from 1 May 2026)

If you’re contemplating possession proceedings for an assured tenancy where a deposit was taken, check this early:

• Is the deposit currently protected in an authorised scheme?
• Were the scheme’s initial requirements complied with (even if late)?
• Has the tenant (and any relevant person) received the prescribed information?
• If there was a historic failure, is it better to remedy compliance now, or return the deposit (where appropriate) to remove the possession bar?

Transitional provisions: tenancies that were assured before 1 May 2026 (but not ASTs)

The amendments made by section 26 do not apply to an existing tenancy that, immediately before commencement, was an assured tenancy other than an assured shorthold tenancy (Schedule 6, paragraph 11 RRA 2025).

This is aimed at the small number of pre-existing assured (non-AST) tenancies where deposit protection was not required before 1 May 2026. For those tenancies, that position carries through.

Bottom line

From 1 May 2026, deposit protection compliance becomes a general gatekeeper for possession in assured tenancies. In most cases, the court will not be able to make a possession order unless the deposit compliance steps are in place.

You can usually cure the possession problem by complying late, as long as you do it before the possession order is made, but you should still expect a penalty if it is late.