Strict rules which decide what fees landlords and agents can charge tenants have been updated.
Here, Katie Lofthouse of WHN offers insight into what can now be charged for, and what will happen if these rules are breached.
What has changed?
The Tenant Fees Act was a measure by the government to reduce so-called hidden costs that many private tenants found themselves being asked to pay.
Under the act, which was introduced in 2019, only a small number of charges were exempt from the rules – including rent and payments in respect of utilities, Council tax etc.
When the ban came into effect, fees could still be charged under pre-existing tenancy agreements during a one-year transition period, but this period has now ended, and the act now covers all tenancies.
What fees can and cannot be charged for?
‘Extras’ which may might have been charged for in the past would often include guarantor forms, credit checks, cleaning services and gardening services.
Under the new rules, the government has clarified the charges that can now be made:
- Rent
- Refundable tenancy deposit (capped)
- Refundable holding deposit (capped)
- Early termination payment
- Payments for the variation, assignment or novation of a tenancy (capped)
- Payments in respect of utilities, communications services, TV licence and Council Tax
- Default fee for late payment of rent, and replacement of lost key / security device.
What happens if fees are illegally taken?
If a landlord fails to comply with the new legislation, they can face serious consequences. They can be issued penalties by local authorities of up to £5,000 for each breach, and even be prosecuted or be handed a penalty of up to £30,000 for repeated breaches.
Landlords can also face banning orders and an entry on the Rogue Landlord Database. Tenants are able to bring claims against landlords to recover fees charged unlawfully, and landlords cannot serve a section 21 notice (eviction) until any prohibited fees have been returned.
For further advice on the Tenant Fees Act, or any other landlord and tenant law matter, call Katie Lofthouse on 01200 408 303 or email her at katie.lofthouse@whnsolicitors.co.uk
