Landlord needs advice.Tenants damaged property and refusing to pay rent

[TinyDiamond]

Asking on behalf of a friend who is no longer in the UK.

She rented out her house here. Tenants moved in Jan 2012. They now are moving out and have given adequate notice to do so however are refusing to pay last months rent and telling LL to keep the deposit to cover this. Problem is that they have caused extensive damage to the property that LL was going to need to use deposit to pay for (the amount will not even cover the repairs required). They have also further breached their contract by subletting.
She did not go through an agent to let out her house but now lives abroad so is not around to sort this out. I think she has messed up though as has not put their deposit in a protection scheme so will not have a leg to stand on.

Are the tenants allowed to use the deposit in this way? If they just do not pay and then move out anyway would she ever be able to claim from them or will she always lose because of the payment protection scheme thing?

Thanks for reading! Any advice or links appreciated.

I'm moving out of a rented property soon and will tell the landlady to keep the deposit as the last months rent.

This is due to having my fingers burnt several times by landlords (and letting agents) keeping deposits despite the place being immaculate when I left. There seems to be no rules - if the LL wants to keep it then they keep it. Game over. :(

However, there's no inventory. The tenancy agreement is a basic sheet of A4 with just names and addresses on and I doubt the deposit is in any kind of scheme.

MrsR- your deposit must, by law be held in a protected deposit scheme to prevent such things happening so there should be no need to use depostit.

Not only should the deposit be protected but the LL or agent is obliged to give you details of which scheme it is in. I would ask for those details immediately and make a complaint if nothing is forthcoming - if they really haven't protected it then, as others have said, they could be fined 3x the original amount.

Agree, bad landlords have caused the ridiculously time consuming and profit sapping system we now have in place. But bad tenants refusing to pay the last months rent have caused most agents to charge 1 months rent PLUS another few hundred as the deposit.No win wins when there's dishonesty.

but with longer standing tenancies (before April 2007) the deposit didn't have to be put in scheme.