What Is the Tenant Fees Act?

Written By PropertyLoop
February 16, 2021

The tenant fees act was introduced in order to level the financial playing field across the private rental sector, safeguarding tenants from historical charges that had been imposed by letting agents and landlords alike. These charges presented a problem in that the initial costs of renting made renting a home simply inaccessible for some.  

what fees can a landlord charge a tenant? propertyLoop

Are Landlords Allowed to Charge Fees? 

Since the introduction of the tenant fess act landlords have been prevented from charging tenants many of the administrative fees historically prevalent within the private rental sector.  Under the regulations, rental property owners are now exclusively permitted to charge their tenants for two types of default fees, alongside the expected deposits and amendments to the tenancy agreement. 

What Fees Can a Landlord Charge a Tenant?  

Landlords are empowered to charge the occupants of their rental property late fees for any rental payments that have not been settled on the due date. Thankfully for struggling tenants, landlords are not able to immediately impose these fees, but must wait until the debt has been outstanding for two weeks. Once this period has expired the fees can be no more than 3% in addition to the bank of England’s interest rate.  

Additionally, if the occupants of a rental property were to lose the keys, landlords are able to charge a “reasonable amount” for them to be replaced, with the expense typically being shown to the tenant through a receipt once the payment is settled. 

Lastly, if renters wish to make any adjustments to the terms comprising the tenancy agreement, then they must also pay the landlord a fee. In most cases landlords will charge tenants a flat fee of £50 for these changes to be made, however providing that the owner can justify the expense, tenants can be charged over this amount.    

Does the Tenant Fees Act Prohibit Cleaning Fees?   

Landlords are unable to ask their tenants to pay for professional cleaning services once the tenancy comes to an end.  As can be expected, tenants can be asked to return the property in a clean condition, with the associated costs of any damage or repairs being deducted from their tenancy deposit.  

What Is the Maximum Deposit a Landlord Can Take?

The 2019 tenant fees act established a monetary threshold on the amount rental property owners are allowed to ask their tenants to pay for both a holding deposit and a tenancy deposit. Under the regulations the amount renters must pay to reserve a rental opportunity through the holding deposit is capped at the equivalent cost of a single weeks rent.  

However, the amount a landlord is able to request their residents pay for the tenancy deposit is largely determined by the annual cost of renting the property. If the tenants pay up to £50,000 each year in rent, the landlord is prevented from requesting more than five weeks rent for the security deposit; however, if the annual rental charge for the property exceeds this amount, owners can request as much as six weeks rent for the tenancy deposit.   

 What Are the Penalties for Breaching the Tenant Fees Act?

If a landlord is found to be imposing illegal fees onto the occupants of their rental property, then they will likely face severe financial penalties. Providing that the breach of the tenant fees act is their first offence they will be served with a £5,000 fine; however, if they are once again found in violation of the regulations within five years then the fine would increase to £30,000.

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