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The Tenant Fees Act 2019 came in on 01 June 2019. The ban on tenant fees applies to new or renewed tenancy agreements signed on or after 1 June 2019.
From 1 June 2020, the ban on fees will apply to all applicable tenancies. You will not be able to charge any fees after this date unless they are a permitted payment.
The ban applies to assured shorthold tenancies (except social housing or long leases), tenancies of student accommodation and licences to occupy housing in the private rented sector in England.
It means you cannot require a tenant (or anyone acting on their behalf or guaranteeing their rent) to make certain payments in connection with a tenancy. You cannot require them to enter a contract with a third party or make a loan in connection with a tenancy.
From 1 June 2019, if you entered into a tenancy agreement, student let or licence to occupy housing in the private rented sector, you are prohibited from charging any fees or other payments that are not included in the list of permitted payments.
Where a tenancy agreement was entered into before 1 June 2019, you will still be able to charge fees until 31 May 2020, but only where these are required under an existing tenancy agreement. After 1 June 2020, the term requiring that payment will no longer be binding. Should you, in error, ask a tenant to make such a payment, you should return the payment immediately and must return this within 28 days. If you do not return the payment within 28 days, you will be treated for the purposes of the Act as having required the tenant to make a prohibited payment (a payment that is outlawed under the ban).
If a pre 01 June 2019 tenancy rolls into a statutory periodic tenancy, the deposit remains as is, until the tenancy is renewed or a new fixed term starts. If the tenancy is renewed or a new fixed term agreement starts after 01 June 2019, you must return the amount of the deposit that is over the cap. Your deposit protection scheme will have the facility to do this once you instruct them.
Here is a guide if you aren’t sure about deposit refunds; https://www.arla.co.uk/media/1047879/tds-deposit-cap-guide.pdf
From 1 June 2020, the ban on fees will apply to all applicable tenancies. You will not be able to charge any fees after this date unless they are a permitted payment.
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.
The only payments you can charge in connection with a tenancy are:
a) the rent
b) 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
c) a refundable holding deposit (to reserve a property) capped at no more than one week’s rent
d) payments to change the tenancy when requested by the tenant, capped at £50, or reasonable costs incurred if higher
e) payments associated with early termination of the tenancy, when requested by the tenant
f) payments in respect of utilities, communication services, TV licence and council tax; and
g) A default fee for late payment of rent and replacement of a lost key/security device, where required under a tenancy agreement
More information/guidance for landlords on the Tenant Fee Ban can be found on the gov.uk website;
