Holding Deposit Calculator

How to use this calculator

1. Enter the rent as it is quotedMonthly is the norm in England. The calculator converts to the correct weekly figure itself, which is where most errors happen.
2. Check what you are being asked forEnter the amounts you have been quoted and the calculator tells you whether they are within the caps.
3. Watch the £50,000 thresholdAbove it the tenancy deposit cap rises from five weeks to six. That is £4,167 a month of rent, so it affects only a small number of tenancies.
4. Remember most other fees are bannedReferencing, credit checks, inventories, tenancy agreements and admin charges are all prohibited payments.

A week is annual rent divided by 52

The Tenant Fees Act caps are expressed in weeks, and the statutory definition of a week's rent is the annual rent divided by 52.

That sounds obvious until you notice how naturally people convert a monthly rent to a weekly one by dividing by four. There are twelve months and 52 weeks in a year, so a month is about 4.33 weeks, not four.

Dividing by four therefore overstates the weekly rent by about 8.3%, and every cap calculated from it is overstated by the same proportion.

On a £1,200 monthly rent, the correct weekly figure is £276.92 and the divide-by-four figure is £300. The holding deposit cap is £276.92, and charging £300 is unlawful by £23.08.

That is a small sum on its own, but the same error on the tenancy deposit is five or six times larger — £1,384.62 correct against £1,500 charged, an overcharge of £115.38.

Most agents get this right, and the error when it happens is usually careless rather than deliberate. But it is common enough to be worth checking, and the calculation takes seconds.

The tenancy deposit cap is five weeks' rent where the annual rent is below £50,000, and six weeks at or above it. £50,000 a year is £4,167 a month, so the six-week cap affects a small number of high-value tenancies only.

There is no discretion in either cap. A landlord or agent cannot ask for more because the tenant has a poor credit history, no UK guarantor, or a pet — though a higher rent can lawfully be charged instead, which is how pet-friendly lettings are usually handled since pet deposits were banned.

What both caps have in common is that they are absolute. Any amount above them is a prohibited payment, recoverable by the tenant, and enforceable by the local authority with penalties against the landlord or agent.

Worked example: £1,200 a month

The annual rent is £14,400.

A week's rent is £14,400 ÷ 52 = £276.92.

The holding deposit cap is one week: £276.92.

The annual rent is below £50,000, so the tenancy deposit cap is five weeks: £1,384.62.

The maximum you can lawfully be asked for before moving in is the deposit plus the first month's rent: £1,384.62 + £1,200 = £2,584.62.

Now the common error. £1,200 ÷ 4 = £300, which would be charged as the holding deposit and £1,500 as the tenancy deposit. That is £23.08 and £115.38 over the caps respectively — £138.46 in total, unlawfully.

The holding deposit is normally put toward the first month's rent or the tenancy deposit once the tenancy is agreed, with your written consent. It is not an extra payment; it is an advance.

Now run a higher rent. At £4,500 a month the annual rent is £54,000, which is at or above the £50,000 threshold, so the deposit cap rises to six weeks. A week is £1,038.46, so the holding deposit cap is £1,038.46 and the deposit cap is £6,230.77.

And at £4,100 a month the annual rent is £49,200 — just below the threshold — so the deposit cap is five weeks at £4,730.77. Four hundred pounds a month of extra rent moves the deposit cap by £1,500, which is a sharp step.

One detail on timing: the deadline for entering into the tenancy is 15 days from the day the holding deposit is paid, unless both parties agree in writing to a longer period. If the landlord fails to enter into the tenancy by then, the deposit must be refunded.

Caps at common rents

Every weekly figure here ends in an awkward number of pence precisely because it is annual rent divided by 52. If an agent quotes you a round figure like £300 or £1,500 as a cap, that is a signal they have divided by four — worth a polite query, and worth checking against the numbers above.

What can and cannot be charged

The Tenant Fees Act works by prohibiting everything except a short list of permitted payments. Anything not on the list is banned, which is a much stronger position for tenants than a list of banned items would have been.

The permitted payments are: rent, a refundable tenancy deposit within the cap, a refundable holding deposit within the cap, payments to change the tenancy capped at £50 unless higher costs can be evidenced, payments on early termination not exceeding the landlord's loss, utilities, communication services, television licence, council tax, and default fees for a lost key or genuinely late rent.

Default fees are tightly constrained. A late rent fee can only be charged once the payment is more than 14 days overdue, and only at up to 3% above the Bank of England base rate on the outstanding amount. A lost key charge must reflect the actual cost and be evidenced.

Everything else is banned: referencing fees, credit check fees, inventory fees, check-out fees, tenancy agreement fees, administration charges, renewal fees, guarantor fees, professional cleaning as a condition of the tenancy, and pet deposits.

The cleaning point is worth spelling out. A landlord cannot require professional cleaning as a term of the tenancy or charge for it up front. They can deduct from the deposit at the end if the property is left less clean than at the start, evidenced against the inventory.

A holding deposit can only be retained in narrow circumstances: if you provide false or misleading information that materially affects the decision to let, fail a Right to Rent check, withdraw from the transaction, or fail to take reasonable steps to enter the agreement. A landlord who simply changes their mind must refund it in full, within seven days.

Only one holding deposit can be held for a property at a time, so an agent taking deposits from several prospective tenants for the same property is acting unlawfully.

Tenancy deposits must be protected in a government-approved scheme within 30 days, with prescribed information given to the tenant. Failure to protect can mean a court ordering compensation of one to three times the deposit, and it blocks a Section 21 notice until remedied.

If you have been charged a prohibited payment, ask for it back in writing first. If that fails, report it to the local authority's trading standards team, who can impose financial penalties, and you can apply to the First-tier Tribunal to recover the money.

This covers England. Wales has its own Renting Homes legislation with similar but not identical rules; Scotland banned premiums outright well before England and has different deposit timescales; Northern Ireland has a separate regime again.

Assumptions and limitations

• Covers England — Wales, Scotland and Northern Ireland have their own regimes
• Applies to assured shorthold tenancies, student lettings and licences to occupy
• Does not cover company lets or long leases, which are outside the Act
• Does not calculate default fees, which must reflect actual evidenced cost
• Does not check whether a deposit has been properly protected
• Assumes a single tenancy — only one holding deposit may be held per property
• General information, not legal advice — contact trading standards or Shelter for a dispute

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