Why it matters
What Deposit Cap means for a landlord
The five-week cap is worked out from the weekly rent (annual rent divided by 52, times 5), not from the monthly rent, and a round-number deposit can quietly go over it. Anything above the cap is a prohibited payment under the Tenant Fees Act 2019: the tenant can recover it through the First-tier Tribunal, and the council can impose a penalty of up to £5,000. Recalculating the cap for each new tenancy takes a minute.
Worked example
How it plays out
Laura lets a flat in Reading at £1,500 a month. The annual rent is £18,000, so the weekly rent is £346.15 and the five-week cap is £1,730.76. She had planned to take £1,750 because it is a round figure. The extra £19.24 would be a prohibited payment, so she takes £1,730 instead.
Common mistakes
Where landlords go wrong
- 01Setting the deposit as a month’s rent plus a bit, without working out the weekly figure.
- 02Rounding up to a neat figure that ends up just over the cap.
- 03Adding a separate pet deposit on top, which takes the total over the cap.
- 04Forgetting the six-week cap applies only where annual rent is £50,000 or more.
What to do
A short checklist
- Calculate the cap as annual rent ÷ 52 × 5 for every new tenancy.
- Round the deposit down, never up.
- Recalculate if the rent changes before the deposit is taken.
- Refund any amount you took above the cap.
Sources
Checked against these sources on 16 September 2026. A guide to the rules in England, not legal advice: for a dispute or a possession claim, speak to a solicitor.
