Menu Search

Tenants Fee Ban

May 3rd 2019
By: Morna Walters
Tenants Fee Ban

The countdown has started!

On 1st June 2019, the Tenant Fees Act will come into force in England.

Are you ready? Do you know what is going to change? Do you know how this will effect you?

Initially, when the Act comes into force, it will only apply to new tenancies and renewals of tenancies, excluding statutory and contractual periodic tenancies that arise after 1st June 2019. After one year, in 2020, the ban will attach to pre-existing tenancies.

Below is our summary to help you understand:

What is the Tenant Fees Act?

  • The Tenant Fees Act will make it illegal for landlords and letting agents to charge any fee other than rent, deposits, holding deposits and charges for defaulting on the contract
  • All of these are subject to additional restrictions as part of the new legislation, and landlords and agents will need to be mindful of these changes

What fees will be banned?

  • Most fees, unless they are exempt, will be banned
  • This includes: credit checks, cleaning services, inventories, admin charges and gardening services

What additional restrictions will the Act bring in?

  • One of the main restrictions the Tenant Fees Act will bring in will be the amount that landlords and agents can charge for deposits
  • Deposits will be limited to five weeks rent as a maximum amount, for tenancies where the annual rent is below £50,000
  • If the annual rent is above this, then the maximum deposit that can be charged is six weeks rent
  • Holding deposits will also be limited to a maximum of one week’s rent, and subject to statutory legislation on the repayment of this, should the tenancy not go ahead

Rent restrictions

  • Landlords and agents will also not be able to set rent at a higher level for the first portion of the tenancy, and then drop it down afterwards
  • Charging a higher rent than you would normally charge for the property, that is consistent throughout the tenancy, is fine

What are the penalties for non-compliance?

  • Where a breach has occurred and a banned fee has been taken, tenants will be able to get any money wrongly paid back, via the county court
  • For a first offence, a fine of up to £5000 can be charged
  • Subsequent breaches could see landlords and agents faced with a fine of up to £30,000.

We know some of this may be confusing and daunting so please get in touch with our team if you have any questions or just want to talk it all through to make sure you are fully clued up before the ban starts. We will let you know of any further information or any changes as soon as we know them.

 

You can call or email your local Lettings team just visit our branches page for all our contact details.