Landlords have less than a fortnight left to register for the Deposit Protection Scheme.
Failure to do so could see them facing thousands of pounds in fines, warns Mitchells Chartered Accountants and Business Advisers.
The Deposit Protection Scheme was enforced in 2007 and anyone who rents a property on an assured short hold tenancy that started after 6 April 2007 must be a member of the scheme.
The scheme makes it a legal requirement for landlords to put tenants' deposits into an official scheme. The deadline for compliance is 23 June and fines for not complying will be based on a figure of three-times the deposit.
To avoid fines, landlords must sign up to one of three Government-backed schemes - My Deposits, Deposit Protection Service or The Tenancy Deposit Scheme.
Chesterfield-based Mitchells’ tax specialist Liz Fisher, who advises hundreds of landlords a year, said: “The Deposit Protection Scheme is to protect the landlord from costly and lengthy disputes.
“There are a number of benefits for landlords who register, not least the fact that if they want to evict a tenant there will be one less hurdle as the deposit will have been protected in the event of a dispute between the landlord and the tenant.”
She warned that landlords who fail to register could also be left powerless if they want a tenant to leave at the end of their contract because, in the event of a dispute, the landlord could be deemed to have failed in their obligations.