Money · 5 min read
Property guardian deposits and fees: what a firm can legally charge
The law caps guardian deposits and bans most other fees. Here are the limits, what to ask about your deposit, and what to do if a firm asks for more.
Facts checked 27 October 2026
- Council fines for a banned fee, then a repeat
- £5,000 / £30,000
- Council fines for a banned fee, then a repeat
Say a firm emails after your viewing. To hold the room, it wants a £150 "admin fee", a "fire safety pack" and a "non-refundable" holding deposit.
Which of those can it ask for? Only the holding deposit, capped at 1 week's payment. And even "non-refundable" isn't always true. Here's how it works.
The law covers guardians
The Tenant Fees Act 2019 started on 1 June 2019. For this Act, "tenancy" includes a licence to occupy housing, which is what most guardians sign.
The government's guardian fact sheet says the same: your payments may be called licence fees, but "the Act still applies".
The rule is simple. A firm can't charge any fee except the ones the Act allows. Everything else is banned.
What a firm can and can't charge
Allowed, under Schedule 1 of the Act
- your regular licence fee, and the capped deposits
- a late-payment charge, only if a payment is 14 days late, of up to 3% a year above the Bank of England base rate
- the reasonable cost of replacing a lost key
- £50 (or reasonable costs, if higher) for a change you ask for, such as swapping who is on the agreement
- a payment if you ask to leave early, up to the firm's loss
- bills, council tax, a TV licence, and phone or internet, if the agreement says you pay them
Not allowed
- admin or sign-up fees
- registration fees
- referencing or credit-check fees
- "fire safety pack" fees
The government's guidance gives "£200 for arranging the tenancy and doing a reference check" as an example of a breach.
Separately, a firm can still claim damages if you break the agreement: the Act doesn't ban that.
Bills and council tax vary a lot between buildings. See what guardians pay.
How big can the deposit be?
The deposit can be no more than 5 weeks' payment if the yearly total is under £50,000. That covers almost every guardian room. (Above that it is 6 weeks.)
One week's payment is the yearly total divided by 52.
- Yearly total (£600 × 12)
- £7,200
- One week (£7,200 ÷ 52)
- £138.46
- Most the deposit can be (5 weeks)
- £692.31
- Most the holding deposit can be (1 week)
- £138.46
So a deposit of one month's payment is under the cap.
Holding deposits: when you get it back
A holding deposit reserves a room while the firm runs its checks.
You pay up to 1 week
It can be no more than 1 week's payment.
You both have 15 days to sign
Unless you agree another date in writing, you and the firm have 15 days to sign.
It comes back within 7 days
The firm must pay it back within 7 days if:
- you sign (it can go towards your deposit or first payment if you agree)
- the firm decides not to go ahead
- the deadline passes without an agreement being signed
Or the firm explains in writing why it keeps it
The firm can keep it only if you pull out, give false or misleading information, fail a right to rent check, or don't take reasonable steps to sign. Even then, it must tell you why in writing within 7 days, or refund it.
So a holding deposit described as "non-refundable" is not non-refundable in every case.
Your deposit isn't in a government scheme
Unlike a tenant's deposit, a guardian's deposit doesn't have to go into a government-approved scheme. And there is no legal deadline for returning a licence deposit.
So ask before you pay
- Where will my deposit be held? Is it kept apart from the firm's own money?
- How many days after I leave will I get it back?
- What can you take money off for, and will you tell me in writing?
- Will there be a check-in report or photos of the room?
As a guide, the published rules of the industry body for guardian firms tell its members to keep deposits in a separate "Guardian" bank account and recommend returning them within 10 working days.
They apply to its members only, and the body's website hasn't been updated since 2023. So ask the firm what it actually does.
Getting your deposit back, and reporting a banned fee
Problems getting deposits back were common in 2017 research. These steps help.
Give notice in writing
Then leave the room empty and clean, and return the keys.
Take dated photos
A firm can take money off for damage if you broke the agreement.
If it keeps your deposit unfairly
You can take action to get it back.
If a firm charges a banned fee
Report it to your council's Trading Standards team
This also covers a holding deposit kept wrongly. Councils enforce the Act.
The council can fine the firm
Up to £5,000, or up to £30,000 (or prosecute) for a repeat within 5 years.
You can ask a tribunal for the money back
You can also ask a tribunal (the First-tier Tribunal) to order the money back.
How it used to be
Before June 2019, extra fees were normal. In a 2017 survey of London guardians, three-quarters had paid for a "fire safety" pack or equipment. A 2018 London Assembly report put the average fire kit at £50.
We read old copies of guardian firms' websites from 2011 onwards. Almost every firm whose terms were saved charged one-off extras on top of the deposit.
Before the ban
- admin, registration or placement fees of about £20 to £130
- fire packs of £60 to £80
- deposits often a flat sum or one month's payment
Since 2019
- many firms word their terms like the law: a 1-week holding deposit and a deposit of up to 5 weeks
A few sites still listed old fees for 1 to 4 years after the ban. That shows the pages weren't updated, not that the fees were charged.
Questions people ask
Can a guardian firm charge an admin fee?
No. Admin and sign-up fees are not on the list of allowed payments, and the Act covers licences.
Does my guardian deposit have to be protected?
No. Guardian firms don't have to use a government scheme, but the deposit is still capped at 5 weeks' payment.
Is a holding deposit refundable?
Usually. The firm must return it within 7 days unless one of a few reasons applies, such as you pulling out, and it must give that reason in writing.
How long does a firm have to return my deposit?
There is no legal deadline for a licence deposit. The published rules of the industry body for guardian firms recommend 10 working days, so ask the firm what it promises.
Can a firm ask for a month's payment up front?
Yes, as your first payment. The ban on rent before signing is for assured tenancies only. Compare this with renting.
Before you pay anything, read the before-you-sign checklist, the plain-words guide to property guardianship, the firms and their rules, the other guides, or browse every listing.
General information, not legal advice. It describes the law in England on 27 October 2026. For advice, contact Shelter, Citizens Advice or a local housing advice centre.