What can you charge your tenant following the Tenant Fees Act 2019?

By October 20, 2019Conveyancing

June 2019 brought in new legislation called the “Tenant Fees Act” which introduces a series of rules on what tenants can be charged for by landlords and letting agents.

So what does this new legislation mean for renters?

Well, firstly the Tenant Fees Act will apply to new tenancies and renewals of tenancies. This’ll eliminate those pesky and sometimes unfair admin fees which are notorious, additionally tenancy deposits will now be capped to five weeks.

So what can a landlord or letting agent now charge you for?

  • A refundable “holding deposit” (of up to a maximum of one week’s rent)
  • Deposits now have a maximum of 5 week’s rent for annual rent below £50,000, or 6 weeks’ rent for annual rental of £50,000 and above)
  • Utilities and communication services; Internet, TV licence, council tax, telephone, etc..
  • Replacement costs for things like keys and security.
  • Contractual damage costs for repair.
  • Payment for tenancy agreement changes. Like change of sharer, this is capped at £50 or, if higher, any reasonable costs.
  • Early termination of tenancy (Capped at landlord’s loss or the agent’s reasonably incurred cost)
  • Interest payments for the late payment of rent (up to 3% above Bank of England’s annual percentage rate)

What can a landlord or letting agent not charge you for?

  • Admin costs will no longer be a charge.
  • Check out and renewal fees.
  • Cleaning fees, unless there is certain proof that the property requires a deep clean.
  • Reference checks, credit checks, guarantor requests and insurance policies.
  • Gardening services.
  • To view a property. 

Importantly, the legislation state that unless a fee is listed as one of the permitted fees, it will not be allowed.

If you’re interested in reading the full legislature, then follow this link to the Tenant Fees Act 2019

But remember, the Act states that landlords or letting agents do not need to pay back any fees which were charged before 1st June 2019. This also means fees which are added contractually like checkout or renewal fees past the June date still stand.  This lasts until May 2020.

Additionally if an agent or landlord breaks the Tenant Fees Act it shall be counted as a civil offence and could land them a fine of up to £5,000.

It is particularly important for landlords to be aware of and consider these changes in the future.  Especially so as landlords who have charged an unlawful fee will not be able to evict a tenant until they have repaid these fees. Failure to comply with the legislation can therefore have serious ramifications.

If you require further advice on your obligations as a landlord, please contact us on 01753 486 777 to discuss your issue.