The Tenant Fee Act 2019 commences from 1 June 2019 and applies to England only (for the time being as it has the ability to extend to Wales)  The Act controls what payments a landlord or letting agent may charge Tenants.

Prior to 1 June 2019, Landlords and Letting Agents were able to charge a Tenant a contribution towards covering the costs involved in the preparation of a Tenancy, such as the application and referencing process, negotiations and administration of all associated documentation. Click here for ‘What to Expect from your Letting Agent’.

The starting point to understand is that ALL payments are essentially ‘prohibited’ unless the payment is expressly ‘permitted’ under the Act. For example, rent and deposits are permitted under the Act but even they have restrictions.

The Tenant Fees Act sets out the Government’s approach to banning letting fees for tenants. The key measures of the Act include:

  • Tenancy Deposits must not exceed the equivalent of five weeks’ rent (unless the annual rent exceeds £50,000 in which case deposits are capped at six weeks’ rent).
  • Holding Deposits will be capped at no more than one week’s rent.
  • The amount that can be charged for a change to a tenancy will be capped at £50 unless the landlord demonstrates that greater costs were incurred.
  • The Consumer Rights Act 2015 is amended to specify that the letting agent transparency requirements should apply to third-party websites.

Alongside rent and deposits, agents and landlords will only be permitted to charge tenants fees associated with:

  • A change or early termination of a tenancy when requested by the tenant.
  • Utilities, communication services and Council Tax.
  • Payments arising from a default by the tenant where they have had to replace keys or a respective security device, or a charge for late rent payment (not exceeding 3% above the bank of England base rate).

Details of our Tenant fee schedule can be found by clicking here