If you have decided to take on a joint tenancy with friends or family and you have all contributed to the deposit it is very important to ensure that the Deposit Protection Scheme that holds your deposit is aware of who the deposit should be returned to and how it is to be divided.
Paying the deposit to the landlord or letting agent
You will ordinarily pay your deposit to the landlord or letting agent at the time of signing the tenancy agreement. It is possible for the details of who paid how much of the deposit to be entered into the tenancy agreement and this is the best way of ensuring that each party to the agreement is recompensed with the correct share of the deposit at the end of the tenancy..
Check the accuracy of records held by the Deposit Scheme
Within 30 days of receiving your deposit, the landlord or letting agents are legally obliged to protect your deposit through one of the Government approved Deposit Protection Schemes and you should be given the contact details of the scheme that has been chosen. You should also receive a certificate with the names of all tenants on it.
What happens if the tenancy details change?
If one or more of the joint tenants moves out before the end of the tenancy, the Deposit Protection Scheme should be notified of such changes. If you feel that the tenants moving out should not be refunded any part of the deposit because for example, you have made the refund to them all parties to the tenancy agreement must agree that the tenancy deposit scheme can redirect the deposit refund to the remaining tenants and send a signed agreement to the scheme. If not, the scheme will divide the deposit equally between all tenants at the end of the agreement.
In most cases if the division of the deposit is not clearly stated in the tenancy agreement the deposit protection schemes will invariably split it equally among all tenants, minus deductions should there be any, at the end of the tenancy.
Whilst it may be great to live with family or friends, because you know and trust each other, it is always best to be prepared for the worst in the event that you fall out, and the best way to avoid problems is to put everything clearly in writing. Should there be a dispute over the return of the deposit, the scheme adjudicators can only make decisions on documentary evidence supplied.