Introduction to the Tenant Fees Act

The Tenant Fees Act came into force in England on 1 June, introducing significant changes for tenants, landlords, and letting agents. The law now limits what landlords and agents can charge tenants, ensuring greater transparency and fairness in the private rented sector.

Permitted Payments Under the Tenant Fees Act

Under the new law, landlords and letting agents can only charge tenants for certain payments. These include:

• Rent
• Tenancy deposit
• Holding deposit
• Payment for defaults
• Payment on variation or termination of the tenancy
• Payments for tenancy assignment or novation

Other essential payments, like council tax, utilities, and communication services, remain allowable.

What Payments Are No Longer Allowed?

Certain fees are now prohibited under the Tenant Fees Act, including:

• Credit checks
• Inventories
• Professional cleaning services
• Referencing
• Admin charges
• Gardening services

Landlords and agents are no longer allowed to charge tenants for these items.

Key Changes for Landlords and Letting Agents

Landlords and letting agents must be aware of several important limitations and changes in how payments can be made. For instance, holding and tenancy deposits are capped, and landlords can't request an additional deposit for tenants with pets. Additionally, charges for things like lost keys or overdue rent are still allowed, but they must meet certain conditions and be clearly justified in writing.

Restrictions on Rent, Deposits, and Penalties

The Tenant Fees Act introduces further limitations:

• Holding deposits are capped at one week's rent.
• Tenancy deposits cannot exceed five or six weeks' rent, depending on the rent amount.
• Landlords cannot ask for an additional deposit for tenants with pets, though they can raise the rent.
• Tenants are no longer liable for penalty fees for contractor callouts or missed appointments.

The Act also includes provisions about late rent payments, with interest charges only applicable after 14 days.

Further Resources and Industry Insights

To ensure full understanding of the Tenant Fees Act, landlords and agents are encouraged to read the full text of the legislation and explore additional resources. ARLA provides a toolkit explaining the details of the new law. Further discussions on the industry's response and the impact of these changes on landlords and agents will follow soon.