Tenant Fees Act

From 1st of June 2019 it became illegal for landlords and letting agents to charge fee’s to tenants.

The Tenant Fees Act is aimed to reduce the costs the tenants can face at the outset and throughout the tenancy. It is also aimed to rebalance the relationship between tenants and Landlords to deliver a fairer, and more affordable private rented sector. 

The Tenant Fees Act encourages Landlords to not have a deposit for the tenants. However, if the Landlord does decide to have a deposit then they can only charge the tenant 5 weeks rent if the annual rent equals to less than £50,000. If the annual rent equals to more than £50,000 then the Landlord will be able to charge 6 weeks rent as the deposit amount. 

Charging your tenant more than the required amount is illegal and could result in a penalty fine of £5000. If you break this law again within 5 years of the first breach, it can be classed as a criminal offence resulting in prosecution. 

The only payments you can charge in connection with a tenancy are: 

  1. the rent 
  2. a refundable tenancy deposit capped at no more than five weeks’ rent where the annual rent is less than £50,000, or six weeks’ rent where the total annual rent is £50,000 or above 
  3. a refundable holding deposit (to reserve a property) capped at no more than one week’s rent 
  4. payments to change the tenancy when requested by the tenant, capped at £50, or reasonable costs incurred if higher 
  5. payments associated with early termination of the tenancy, when requested by the tenant 
  6. payments in respect of utilities, communication services, TV licence and council tax; and 
  7. A default fee for late payment of rent and replacement of a lost key/security device, where required under a tenancy agreement 

If the fee you are charging is not on this list, it is a prohibited payment and you should not charge it. A prohibited payment is a payment outlawed under the ban.