Holding deposit calculator

A holding deposit reserves a home while you reference the applicant and get the agreement ready. The Tenant Fees Act 2019 caps it at one week’s rent (Schedule 1, paragraph 3) and defines one week’s rent as the annual rent of the tenancy, as it will be when granted, divided by 52. Anything above that is a prohibited payment. The cap is a ceiling, not a target, and GOV.UK’s guidance for landlords says you do not have to take a holding deposit at all. This is England’s law (Schedule 2, paragraph 1): the rules in Wales, Scotland and Northern Ireland differ.

At £1,000 a month the annual rent is £12,000.00, and that divided by 52 is £230.76 and a fraction of a penny more. The Act gives no rounding rule and GOV.UK’s guidance gives none either, but anything over one week’s rent is prohibited, so the calculator rounds down to £230.76. Rounding to the nearest penny would give £230.77, a fraction of a penny over one week’s rent, and the excess is a prohibited payment. Weekly rent needs no sum: at £300.00 a week the cap is £300.00. Rent paid every four weeks is multiplied by 13 first, so £950 every four weeks is £12,350.00 a year and a cap of £237.50.

The cap belongs to the tenancy, not to each person on it. Three sharers on one joint tenancy at £1,950 a month can be asked for £450.00 between them, £150.00 each if they split it equally, and never £450.00 each. In a house let room by room, each room has its own tenancy and its own cap. And a home can carry only one holding deposit at a time: a second is not a permitted payment unless the earlier one was repaid in full, applied to the first rent or the tenancy deposit with consent, or lawfully kept (Schedule 1, paragraph 3(5)).

Schedule 2, paragraph 2 sets the deadline for agreement: the fifteenth day of the period beginning with the day the landlord or agent receives the holding deposit. A period that begins with a day includes that day, so receipt is day 1 and the deadline falls 14 days later. Money received on Monday 2 November 2026 has a deadline of Monday 16 November 2026; received on 20 December 2026, the deadline is 3 January 2027. Some guidance, GOV.UK’s included, puts it as 15 days after receipt. The calculator follows the Act’s own words, which give the earlier date. The agreement has to be made before the deadline (paragraph 3(c)), and the Act does not say whether the deadline day itself counts as before it, so the safe course is to sign by day 14: by Sunday 15 November 2026 in that example. You and the tenant can agree a different deadline in writing, earlier or later.

Paragraphs 3 and 4 say when the money goes back. If the tenancy agreement is signed, it is repaid within 7 days beginning with the date of the agreement, unless the tenant consents to it going towards the first rent or the tenancy deposit (paragraph 6). If you decide before the deadline not to let to them, the 7 days begin with the day you decide. If no agreement is made before the deadline, they begin with the deadline, and a signing after that does not change it: the tenant’s consent under paragraph 6 answers only the duty that comes with signing. To move the deadline, agree a later one in writing before the first one passes. Each 7 days counts its first day, so the last day is 6 days on: a deadline of Monday 16 November 2026 means repayment by Sunday 22 November 2026.

You can keep it only on the grounds in paragraphs 8 to 12. The applicant failed the Right to Rent check and you could not reasonably have known before taking the money; they gave false or misleading information you are reasonably entitled to take into account; they told you before the deadline that they would not go ahead; or they did not take all reasonable steps to sign before the deadline while you, and any agent, did. The last two do not apply if, before the deadline, you or your agent required a payment the Act bans, or behaved so that it would be unreasonable to expect them to sign (paragraph 13). Only the first two are open after your own decision not to let, and the calculator treats a decision made on the deadline day itself as that kind of decision. On any ground, you must give the reasons in writing within the same 7 days, or repay it (paragraph 5).

If part of it goes towards the tenancy deposit, that part counts as received on the date of the tenancy agreement (paragraph 7), and its 30 days to protect it and give the Prescribed Information begin with that date (Housing Act 2004, section 213): signed on Wednesday 11 November 2026, protect it by Thursday 10 December 2026. Any other part of the deposit has its own 30 days from the day it reached you. If the tenant paid the balance on Wednesday 4 November 2026, its 30 days end on Thursday 3 December 2026, so protect the whole deposit and give the Prescribed Information by then.

Requiring a holding deposit over the cap, or keeping one without a ground and written reasons in time, can bring a financial penalty of up to £5,000 from the local authority for a first breach (section 8). If you had a penalty or a conviction for requiring a prohibited payment in the last five years, requiring another, such as more than one week’s rent, is an offence: the local authority can impose a penalty of up to £30,000 or prosecute (sections 8(3) and 12). Keeping a holding deposit unlawfully again stays at up to £5,000 each time. The applicant can also apply to the First-tier Tribunal to get the money back (section 15).

Sources, read on 25 October 2026: the Tenant Fees Act 2019 on legislation.gov.uk (Schedule 1, Schedule 2, section 8, section 12 and section 15), the Housing Act 2004 (section 213), and GOV.UK’s Fees you can charge as part of a tenancy, Tenant Fees Act guidance for tenants and statutory guidance for enforcement authorities.