Can a Landlord Charge a Deposit for a Lodger?

If you are renting out a room in your own home, understanding what you can and cannot charge a lodger upfront is something many homeowners get wrong from the start. Lodgers sit in a very different legal category compared to full tenants, and the rules around deposits reflect that difference. Unlike tenants who have formal protections around things like the section 21 eviction notice process, lodgers have fewer statutory rights, which actually gives live-in landlords more flexibility when it comes to charging and holding a deposit.

What Is a Lodger Deposit?

A lodger deposit is simply an upfront sum of money taken from the lodger before they move in. It acts as financial protection for the homeowner against unpaid rent, damage to the room or shared areas, or any other costs that arise during the lodger's stay.

There is no legal cap on how much you can charge a lodger as a deposit. This is different from tenant deposits, which are capped at five weeks rent under the Tenant Fees Act 2019. Because lodgers are not assured shorthold tenants, that legislation does not apply to them.

Does a Lodger Deposit Need to Be Protected?

This is one of the most commonly misunderstood points for homeowners taking in a lodger. The answer is no. Government approved tenancy deposit protection schemes such as the Deposit Protection Service or MyDeposits are only a legal requirement for assured shorthold tenancies. Since a lodger lives in your home with you as the resident landlord, the arrangement does not create an assured shorthold tenancy. This means you are not legally required to register the deposit in a protection scheme.

However, this does not mean you should handle it carelessly. Keeping a clear written record of the deposit amount, the date it was received and the conditions for returning it is strongly recommended.

What Should a Lodger Agreement Say About the Deposit?

Having a clear and detailed lodger agreement in place before your lodger moves in is essential. This document should state the deposit amount clearly, outline exactly what the deposit covers, specify the conditions under which deductions can be made and confirm how and when the deposit will be returned at the end of the arrangement.

Without this in writing, disputes become much harder to resolve fairly for either party.

How Much Should You Charge as a Deposit?

Most live-in landlords charge the equivalent of two to four weeks rent as a deposit. This gives a reasonable level of protection without asking for an amount that puts off good prospective lodgers. Whatever amount you decide on, make sure it is clearly documented from day one.

Final Thoughts

Charging a deposit from a lodger is not only legal but genuinely sensible. The key is to set it at a fair amount, document everything in writing and treat the arrangement professionally from the very beginning. A well structured agreement protects both the homeowner and the lodger and prevents misunderstandings further down the line.