With the fee ban set to come in on the 1st June 2019, everything from the fees you charge to deposits is set to change. Below we’ve outlined some key things you need to know.

Security Deposits

  • These must be capped at 5 weeks rent where annual rent is below £50,000.
  • Pet deposits are banned but increased rent can be charged provided this is advertised in the property advert that an increase in rent will apply should the tenant have pets.
  • Pest control can come out of the security deposit but cannot be charged as an admin fee to tenants during the tenancy.

Holding Deposits

A deposit can only be withheld should the:

  • Tenant pull out
  • Fails Right To Rent
  • Provides false or misleading statements (If the tenant actively lies about earnings or CCJs, this lie must be able to be proved via a tenant application with declaration.)
  • The agreement deadline has been missed (By 15 days which can be extended by mutual agreement) caused by the tenant or their referees.
  • A reason for the deposit being withheld should be given to the tenant in writing within 7 days.
  • Failing referencing is not a valid reason to withhold a deposit, this will be seen as the agent pulling out and not the tenant.
  • Just one holding deposit from one applicant must be taken at a time.
  • If the tenant requests a change to the clause and the landlord refuses, it will be seen as the landlord or agent pulling out. The agent should therefore inform the tenant in writing that tenancies are non-negotiable or to have special terms, they must be approved or declined before taking a holding deposit.

The TDS and DPS have created a useful calculator you can use to calculate your deposit cap. Click here to use the TDS calculator whilst the DPS have created this useful tool here.

Is It Legal For My Landlord To Charge For Hot Water, Gas And Communal Cleaning?

This cannot be charged as a separate fee but can be included as part of the overall rent you charge. As long as the charge is included in the overall rent, this is a permitted payment.

When a tenant has caused damage which has required the landlord to remedy the issues (such as blocking a toilet by flushing nappies down it) and the landlord instructs their agent to arrange the works, can the landlord pass on the agents’ commission as well as the actual costs of the repair?

Charging the tenant commission alongside repair costs falls against the terms of the fee ban. ARLA have looked into this and found this charge may only be possible if there is a term within the agreement at the start of the tenancy, making this clear to the tenant. However, should you decide to do this you may be liable for dispute under the Consumer Protection Regulations exposing you to a fine and the possibility of not recovering anything, therefore VTUK and ARLA recommend you do not do this.

Available for all Openview and VTUK users, we’ve put together a useful guide detailing everything you need to know about the upcoming tenant fee ban. Download it in the Openview Enterprise Facebook Group.

fee ban e-book

demo (1)

Whether it’s rent collection, automating your arrears process or the tenancy agreement, Openview can help, call 0800 328 0460, email info@vtuk.com or visit vtuk.com.

The information in this blog is believed to be factually accurate at the time of writing the blog, VTUK cannot be held liable for any decisions made based on the contents of this document.

Explaining The Tenant Fee Ban