Holding deposits, keeping client accounts, paying interest.

You should talk to your accountant about the detailed requirements, under sections 12 to 15 of the Estate Agents Act 1979 and the Estate Agents (Accounts) Regulations 1981, for handling clients' money, including:

  • deposits
  • keeping client accounts
  • payment of interest


You may be asked to hold a deposit. This means that you’re holding money on trust, or in Scotland as an agent. You’ll need to account for the client's money in a very precise way, as explained below.

There are two types of deposit:

  • pre-contract deposit: paid before the exchange of contracts to show a serious intention to buy. In Scotland, it’s against the law to accept a pre-contract deposit.
  • contract deposit: paid at the exchange of contracts

You must put the deposit in an account, called a client account, which is set up for this purpose at a bank, or other authorised financial institution.

You can pay money from a connected contract, such as money used to buy carpets or curtains, into a client account.

You cannot pay any other client money into this account. For example, if you also work in lettings or property management, you cannot pay client money such as rents into the client account set up for estate agency deposits. 

Keeping client accounts

When you keep a client account, you must:

  • pay clients’ money in without delay
  • keep detailed records of all transactions 
  • give detailed receipts for all money you get
  • have your accounts examined and reported on by a qualified auditor, within six months of the end of your accounting year
  • be able to produce your latest auditor's report, if an authorised person, for example a trading standards officer, asks you to
  • keep the accounts and records for six years after the end of the accounting period they relate to, even if you take them over from someone else

If you don’t, you could face prosecution and a fine of up to £2,500. 

Payment of interest

If the interest on a deposit of over £500 is more than £10, you must pay it to the client.