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Tenant Fees Act extended to cover existing tenancies in England

Victoria Barker
Written by Victoria Barker

The Tenant Fees Act came into force in England last year, and from today (Monday 1st June) it has a wider application for tenancies in England.

The law means that landlords and letting agents cannot charge fees other than rent, deposits, holding deposits and charges for defaulting on the contract – with additional restrictions on how much tenants must pay. The full list of permitted payments can be read further down in this article.

When the fees ban was first introduced last June, it applied to new tenancies created after that date and some renewals.

There was a one year transition period attached to the legislation for existing tenancies-and this has now come to an end, meaning the legislation now applies to existing tenancies (Assured short-hold tenancies) as well.

  • Landlords in both England and Wales should read their tenancy agreements to identify the type of periodic tenancy that their tenancy will run on as. If the tenancy has a contractual periodic continuation of the existing tenancy then they will likely not be caught by the ban even if their periodic tenancy starts after the commencement date.
  • However statutory periodic tenancies or contractual periodic clauses that specify a separate periodic contract is created will definitely be caught.

Do I need to pay excess deposit back if my tenancy was renewed before May 2019? Read our recent call of the week.

What fees are banned?

In practice, this means that from 1st June 2020, landlords and letting agents in England can not charge for ‘extras’ such as cleaning, pets, referencing, inventories and admin.

The amount landlords can charge for security deposits or holding deposits is also limited under this piece of legislation.

  • Security deposits are limited to five weeks’ rent (unless the annual rent for the property exceeds £50,000) in which case the deposit is capped at six weeks’ rent.
  • Holding deposits are limited to one weeks’ rent

What fees can still be charged?

According to the legislation, the only fees that can be charged are:

  • rent
  • a refundable tenancy deposit capped at no more than 5 weeks’ rent where the total annual rent is less than £50,000, or 6 weeks’ rent where the total annual rent is £50,000 or above
  • a refundable holding deposit (to reserve a property) capped at no more than 1 week’s rent
  • payments associated with early termination of the tenancy, when requested by the tenant
  • payments capped at £50 (or reasonably incurred costs, if higher) for the variation, assignment or novation of a tenancy
  • payments in respect of utilities, communication services, TV licence and Council Tax
  • a default fee for late payment of rent and replacement of a lost key/security device giving access to the housing, where required under a tenancy agreement

Big penalties for non-compliance

Landlords who do not comply with this legislation could face financial civil penalties of up to £5000 for each offence, with larger financial penalties reaching up to £30,000. Other penalties for non compliance include a banning order or even criminal prosecution.

Additionally, if a prohibited fee has been charged when it should not have been then this will impair a landlords’ ability to successfully serve a Section 21 notice for possession until the prohibited payment has been paid back to the tenant in full.

Wales’ tenant fees ban The Tenant Fees Act applies to landlords in England only, but there is a different fees ban in Wales, which was introduced on 1st September last year under the Renting Homes (Fees etc) (Wales) Act 2019. There are some differences between the two pieces of legislation which you can read about in this fees ban matrix put together by the Tenancy Deposit Scheme.

About the author

Victoria Barker

Victoria Barker

Victoria is the Communications Officer for the RLA.

She is responsible for producing articles for our Campaigns and News Centre, the weekly E-News newsletter and media review, and creating social media content. She also contributes to our members magazine, Residential Property Investor.

7 Comments

  • Hi, my wife and I moved into a new 2 bedroom apartment in October 2019. We’ve had an ongoing small leak in the middle of the lounge which we have a constant drip and have to change the bowl daily. We’ve had two visit before COVID-19 which they cut a big hole in the ceiling and the mould has spread and is growing week by week. They have said due to Covid-19 they can’t get anyone in to fix this. I work as a PM in construction and we’ve had various leaks on site which are repaired on the day so I just see them using this as a seat tactic. What can we do to take this further as it’s been 6-7 months now?

  • Are there any charges or financial penalties that can be applied to tenants abusing the tenant rules such as non payment of rent destruction of property With current legislation in favour of the tenant it seems wrong that a tenant can literally get away with not paying any rent continue to stay in a property for a number of months before being evicted and then a landlord
    Would have to take a separate claim to recover the rent arrears having waited many months for possession

  • I have a tenancy which was signed in July 2017, renewed in July 2018 for a further year; this has now changed to a periodical. We originally took a deposit of over 5 weeks rent – am I correct in believing that we are still able to keep the larger deposit amount as it is a periodical which was signed before May 2019.

    • Hi Sara, that’s right- if the tenancy goes statutory periodic and this happens on or after 1st June 2020, then it is advisable for someone to return a deposit (if it was above 5 weeks) but it sounds like this tenancy was renewed in July 2018 and so not creating a ‘new tenancy’ after this legislation came in, in the eyes of the law. More on deposits and the Tenant Fees Act can be read in this recent call of the week:
      https://news.rla.org.uk/call-of-the-week-tenant-fees-ban-and-deposits/ I hope this helps.

  • If you have a tenancy agreement which was taking out prior to the act, and a deposit of 6 weeks was taken – does the extra week need to be refunded now or on termination of the agreement along with the rest of the deposit?

  • Another ill conceived slap in the face for property owners doing the councils work. I have had a property occupied by a couple of freeloaders who owe thousands in unpaid rent, the dwp did very little to help, the council did nothing and when finally the female of the pair overdosed on alcohol and died, did I get my property back in such a mess, it has cost me thousands more and over eight months to repair damage and the hell smell of urine.
    The council knew these ‘people needed some kind of supervision due to their mental condition and offered nothing other than more regulations. This sector has become SO toxic since the introduction of council interference it is not sustainable and the councils will soon find themselves in the position of having to buy back the housing stock they sold off to re home the thousands that will end up back on the streets. councils are occupied by short sighted greedy and extremely stupid individuals who do not deserve the positions they hold.
    I will be leaving this sector as soon as is viably possible as councils make the PRS an un sustainable nightmare.

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