I’m using openrent RentNow and the deposit will be held by mydeposit.
If there are issues with late payment or damages, how would we deduct money from the deposit? And can this only be done at the end of the tenancy or can it be done during it, for instance in case of damages after 6 months for instance?
The deposit is the tenants money so you dont just make deductions, you propose them and get the tenants agreement. You would then apply for this amount to be retained using their portal. If the tenant doesnt agree you ask the scheme to adjudicate. Deposits are intended to be claimed only at the end of the tenancy. If the tenant damages something during the tenancy, you get it repaired and ask them to pay. If they refuse, you wait till the tenancy ends and claim it through the deposit.
Success in claiming for damages depends on the quality of your evidence. A good written inventory plus photos at a minimum.