Step 1

Go to the Office 365 Compliance Admin > https://compliance.microsoft.com/homepage

Step 2

Click on Policies and then Retention

Step 3

Click on New Retention Policy

Step 4

Name the policy and then click on next

Step 5

Choose either Static or Adaptive for the policy type.  In most cases Static is suitable

Step  6

Make sure only Teams chats is selected and click on next

Step 7

Choose your retention period, make sure “Delete items automatically” is selected and click on next

Step 8

Click on Submit and you’re done