Landlords, from next week the Tenant Fees Act 2019 applies to all your tenancies and you are banned from charging renters any fees apart from those specified in the legislation. That’s rent, tenancy deposits, holding deposits and any default charges that are specifically stated plus a few others we list below.
The Act came into effect in England on 1 June 2019 with a one-year transitional period, which exempted existing tenancies from the new rules. This is about to end. So from Monday 1 June, all assured shorthold tenancies and HMO licences are subject to the legislation. The legislation also introduced a deposit cap that limits deposits to five weeks’ rent (or six weeks if the annual rent is £50,000 or more).
To remind landlords of the rules, here’s a list of allowable charges:
- A refundable deposit
- A refundable holding deposit – capped at one week’s rent
- Rent, utilities, communication services, TV licence and council tax
- Fees for changing or ending a tenancy at the tenant’s request
- Default fees for late payment of rent
- Fees for replacing a lost key or security device, where required under a tenancy agreement and with evidence of the cost in the form of a receipt or invoice.
If landlords charge for anything that isn’t on this list that’s a breach of the new legislation. This carries a fine of up to £5000. And even worse, if you break the rules again within five years of being fined the first time, that counts as a criminal offence and carries an unlimited fine. So make sure you understand the new rules.
For a full list of charges that are now banned under the legislation, you can read the Government guidance in full here.
Finally, it’s worth remembering that any deposit taken before 1 June 2019 that was higher than the five or six-week cap that is now in place, doesn’t need to be refunded immediately. Instead, renters should receive a refund at the end of the tenancy. The new tenancy deposit cap will apply to any new tenancy agreed after that.
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