TDS vs DPS vs mydeposits: Which Is Best? (2026 UK Guide)

You’ve taken a deposit and you have 30 days to protect it. Three schemes are authorised by MHCLG to do that in England, under section 212 of the Housing Act 2004: DPS (Deposit Protection Service), TDS (Tenancy Deposit Scheme) and mydeposits.

The legal protection they give is identical. The same 30-day registration deadline, the same prescribed-information rules, the same exposure to a court-ordered penalty of 1–3× the deposit, and the same block on most Section 8 possession grounds until the breach is fixed (Section 21 was abolished on 1 May 2026).

So the question is never "which scheme is most legally robust". It is "which scheme fits your portfolio". This guide breaks the choice into the four things that actually differ in 2026: custodial vs insured, per-deposit cost vs subscription, how fast disputes are settled, and what else the provider offers (insurance, agent tools, deposit replacement). At the bottom there is a 60-second quiz that gives you a ranked recommendation.

The 30-second answer

If you don’t want to read 4,000 words, here is the conventional wisdom in two lines per profile:

• Self-managing landlord, 1–9 tenancies, no agent, no specialist needs → DPS Custodial. Free, simplest, run under a government contract, stable.
• Letting agent holding client money on behalf of landlords → TDS Insured. The deposit stays in your client account and the scheme insures it.
• Portfolio landlord, 10+ tenancies, wants insurance + deposit-replacement from one vendor → mydeposits Annual Subscription. Hamilton Fraser ecosystem, predictable annual cost.

If your situation matches one of those, the rest of the article is background. If it doesn’t (say you are a 4-property landlord using one agent and one self-managed flat), read on.

What "custodial" and "insured" actually mean

Every authorised scheme offers two product variants. The legal effect is the same; the cash-flow mechanic is opposite.

Custodial = the scheme holds the deposit in trust during the tenancy. You transfer the cash to the scheme within 30 days of receipt, the scheme issues the protection certificate, and the money sits there until the tenancy ends. End-of-tenancy: tenant and landlord agree the deduction split, the scheme refunds the agreed amounts. Custodial is free for the landlord on all three schemes (the scheme makes its money on the interest earned on the float).

Insured = the landlord (or agent) holds the deposit in their own account. The scheme provides an insurance wrapper that guarantees the tenant will be repaid even if the landlord/agent disappears. Insured costs a per-deposit fee (fees vary, so check the scheme’s current price list) or, on mydeposits Annual Subscription, an annual fee that covers unlimited insured deposits.

Which is "better"? It depends on what you value:

• Custodial wins on: zero cash-flow management, simplest end-of-tenancy mechanics, no protection-cost line on your P&L.
• Insured wins on: keeps the cash in your account during the tenancy (useful for very small landlords who genuinely need the float) and is faster on day one (no transfer to the scheme).

For a self-managing landlord with a healthy reserve and 1–9 tenancies, custodial is almost always the right answer. The "I want the cash flow" argument matters when you are running 50+ tenancies and £200k of deposits is genuinely meaningful working capital, but at that scale you also want the predictable cost of an annual subscription, which only mydeposits offers cleanly.

DPS: the default run under a government contract

The Deposit Protection Service (DPS) is run by Computershare under contract to MHCLG. All three schemes have operated since April 2007. DPS suits the self-managing landlord because the custodial product is the simplest possible thing: transfer the money, get a protection certificate, do nothing for the rest of the tenancy.

Pricing in 2026:

• Custodial: free for landlords and tenants. Free dispute resolution included. No cap on the number of deposits you can register.
• Insured: a fee per deposit. Fees vary, so check the scheme’s current price list. Dispute resolution is included; there is a small additional fee per disputed adjudication.

Strengths:

• Run by Computershare under a government contract.
• Custodial is the safest default for a landlord who wants zero ongoing involvement once the deposit is registered.
• Free custodial is a real saving over a portfolio, because insured protection charges a fee for every deposit.

Weaknesses:

• Insured per-deposit pricing is competitive but not cheapest at scale (mydeposits Annual beats it from ~10 deposits).
• Less specialist tooling than TDS for letting agents handling client money.

Best for: a self-managing landlord with 1–9 tenancies who values simplicity and free protection over speed of dispute resolution or wider ecosystem.

TDS: the agent and adjudication champion

The Tenancy Deposit Scheme (TDS) is run by The Dispute Service Ltd. Like the other two schemes, it has operated since April 2007. Its insured product, TDS Insured, is used by letting agents who hold deposits in their client account.

Pricing in 2026:

• Custodial (TDS Custodial): free for landlords and tenants. Free dispute resolution included.
• Insured (TDS Insured): a fee per deposit. Fees vary, so check the scheme’s current price list.

Strengths:

• Strong online dispute platform with structured evidence upload. Useful when you handle a lot of disputes.
• Run by The Dispute Service Ltd, a not-for-profit company.

Weaknesses:

• Less name-recognition with tenants outside the agent-managed segment.
• Insured per-deposit pricing not cheapest at portfolio scale.
• No bundled landlord insurance / deposit-replacement product the way mydeposits offers.

Best for: a letting agent holding client money, or a self-managing landlord who has had a previous deposit dispute and wants structured online evidence upload for the next one.

mydeposits: the portfolio and ecosystem play

mydeposits is run by Hamilton Fraser, an insurance group that also owns Total Landlord Insurance, Client Money Protect (agent client-money insurance), and the PRS redress scheme. Like DPS and TDS, mydeposits has operated since April 2007.

Pricing in 2026:

• Custodial: free for landlords and tenants.
• Insured (pay-per-deposit): a fee per deposit. Fees vary, so check the scheme’s current price list.
• Insured (Annual Subscription): a fixed annual fee that covers unlimited insured deposits. Typically the cheapest option across all three schemes for landlords with 10+ tenancies.

Strengths:

• Annual subscription beats pay-per-deposit on insured pricing from roughly 10 active tenancies onwards, which matters for portfolio landlords.
• One-vendor relationship for protection + insurance + Client Money Protect (for agents) + PRS redress.
• Strong landlord tooling outside the protection product: insurance quotes, rent guarantee, eviction support.

Weaknesses:

• Subscription model only makes sense at scale: a 3-property landlord paying for unlimited insured deposits is overpaying.
• Tenant familiarity lower than DPS / TDS in the self-managing landlord segment.

Best for: a portfolio landlord with 10+ tenancies who wants predictable annual cost on insured protection and the ability to consolidate insurance + deposit-replacement + redress with one vendor.

Side-by-side: the matrix that matters

The 5/6-week deposit cap means the following weeks’ rent are typical:

• £1,500/month rent → 5 weeks = ~£1,730 deposit at risk per tenancy.
• £2,500/month rent → 5 weeks = ~£2,884 deposit.

All three meet the legal requirement under the Housing Act 2004 identically. The differences are commercial, not regulatory.

How to switch between schemes

You can switch between schemes. There is no statutory penalty for moving from one authorised scheme to another. The mechanics:

Switching at end of tenancy (the safe, common case):

1. 1Refund the deposit out of the old scheme on the agreed split.
2. 2Take the new tenancy deposit and register it in the new scheme within 30 days of receipt.
3. 3Issue the new prescribed information citing the new scheme.

Switching mid-tenancy (more involved, requires care):

1. 1Tell the tenant in writing that you are moving the deposit to a new scheme.
2. 2Release the deposit from the old scheme (custodial) or update the old scheme’s records (insured).
3. 3Protect the deposit in the new scheme straight away.
4. 4Give the tenant updated prescribed information for the new scheme straight away.
5. 5Save the entire chain of evidence: dates, certificates and the prescribed information you gave.

Most landlords switch between tenancies rather than mid-tenancy because the audit trail is simpler. The most common switch is TDS Insured → DPS Custodial when a landlord moves from agent-managed to self-managed (drops the per-deposit fee), and DPS → mydeposits Annual when a landlord crosses ~10 tenancies (drops to predictable annual cost).

What the Renters’ Rights Act 2025 changes

The Renters’ Rights Act 2025 (in force 1 May 2026) keeps the core of the deposit rules. The 30-day registration deadline, the prescribed-information rules and the 1–3× penalty exposure under section 214 of the Housing Act 2004 are all unchanged.

What it does change:

• Section 21 abolished, possession rule rewritten: a deposit breach now stops a Section 8 possession order on most grounds (not Grounds 7A or 14) until the deposit is protected and the prescribed information given, and doing it late now counts (Housing Act 2004, s.215, as substituted on 1 May 2026). Lateness still carries the 1–3× penalty.
• Periodic from day one: every new tenancy is periodic. The deposit you take at the start protects against the whole of the tenancy, not just the original fixed term. Renewals are no longer an event: you protect once at the start, and the protection runs until the tenancy ends.
• Section 13 rent increases: the deposit cap is set by the annual rent when the tenancy is granted, renewed or continued (Tenant Fees Act 2019, Schedule 1, paragraph 2), and the Act says nothing about topping up a deposit after a rent rise. Take advice before asking for more; any extra you do take has to be protected, with prescribed information for the new total.

The practical implication is that the scheme choice matters more in 2026, not less. With Section 21 gone, the deposit protection chain has to be airtight for the entire life of the tenancy. Move a deposit to another scheme mid-tenancy without giving the prescribed information for the new scheme, and the court can refuse a Section 8 possession order until you do.

The audit-trail problem. Whichever scheme you pick, you also need to prove registration: certificate number, registration date, prescribed information served, tenant receipt logged. LetCompliance keeps the deposit record per tenancy: the 30-day clock, the prescribed-information receipt and the scheme certificate, stored against the property next to the tenancy agreement and the rent ledger. If a Section 8 claim ever turns on the deposit, the dates are on file, not somewhere in your email.

The 60-second decision quiz

If you want a personalised recommendation in under a minute, run the Deposit Scheme Quiz: 5 questions on cash-flow preference, portfolio size, agent involvement, how much dispute speed matters to you, and what else you want from the provider. The quiz scores all three schemes on a 0–14 scale and returns a ranked recommendation with a runner-up.

Companion tools:

• Deposit Cap Calculator: work out the 5 / 6-week lawful maximum deposit before you take it.
• Deposit Protection Deadline Calculator: the 30-day clock from receipt.
• Deposit Protection Penalty Calculator: the 1–3× multiplier exposure if you missed it.

Sources

• legislation.gov.uk: Housing Act 2004, sections 213-215
• GOV.UK: Tenancy deposit protection
• MHCLG: Authorised tenancy deposit schemes list
• Tenant Fees Act 2019: Schedule 1 deposit cap

Don't lose 1-3× the deposit to a missing prescribed-information receipt. Whichever scheme you pick, LetCompliance keeps the certificate, the 30-day clock and the prescribed information you served against the tenancy, alongside the agreement, the rent ledger and the check-in inventory photos. If you ever need possession under Section 8, the deposit dates are already on file, in date order, rather than in a Friday-night search of your inbox.