Can Someone Explain The Tenant Fees Ban In Layman’s Terms?

Can someone explain the Tenants Fees ban to me in layman’s terms?

For the period of time both before and after its enactment, the Tenants Fees Act of 2019 was a hot topic in the rental sphere. Despite a whole year having passed since, it seems like the details of this legislation haven’t fully trickled down to many of the UK’s renters.

So, Marks Out Of Tenancy put together this article explaining the ins and outs of the 2019 Act and what it means for the rental industry for both tenants and landlords.
 

What exactly is the Tenants Fees Act of 2019?

Essentially, the Tenants Fees Act was legislation voted through Parliament in 2019 that banned letting fees paid by tenants in the private rental sector.

Before this Act, letting agents and landlords were able to charge for an array of different renting-related tasks, such as: carrying out inventories of the property, verifying references, doing background checks, processing applications, and visa checks. Most of these fees were charged prior to the tenant moving in.

In Conservative MP Heather Wheeler's words, the Bill will put a stop to “unfair and hidden charges, making it easier for tenants to find a property at a price they are willing to pay, and saving renters an estimated £240 million in the first year alone.”

The Act officially came into force on the 1st of June 2019, though the roll-out of the fee ban differed slightly between the constituent countries of the United Kingdom; England’s ban became law on 1st June 2019, whereas Wales’ was 1st September 2019, though Scotland was ahead of its fellow southern counterparts and had already banned letting fees previously. 
 

The ban applies to most rental housing contracts on the British market, for example: all assured shorthold tenancies, student accommodation tenancies, and licences to occupy housing in the private rented sector. 

Do I need to pay any fees when renting now?

You might be sat there hoping that this means you won’t have to pay any fees again, though unfortunately that’s not the case. There are several “permitted payments” that landlords and letting agents can still charge you, for example:
- Rent (I mean, you’re always going to have to pay that, right?)
- Tenancy deposit (this has a cap of five or six weeks’ worth of rent)
- Holding deposit (capped at one week’s rent)
- Default fees/damages (Lost your key? You can still be fined for this)
- Changes to tenancy (including surrendering your tenancy)
- Other payments (TV license, council tax, utilities, phoneline, broadband, satellite TV)

For a detailed list of these permitted and prohibited fees, check out the Government’s official Tenant Fees guidance booklet for landlords and letting agents

What do I do if my landlord illegally charged me extra fees?

First off, you should read through your tenancy agreement and check your bank outgoings to see exactly what you were charged for and check if it definitely was a prohibited fee. Then, if you’re certain you shouldn’t have paid what your landlord demanded, then you should contact your local authority and Trading Standards who can take a look at your case for you. 
 

If it can be proven that you were in fact illegally charged extra fees, your landlord may be fined up to £5,000, though if this isn’t the first time they’ve breached legislation within the past five years then it becomes a criminal case. If the decision to prosecute is not taken by the government, then the landlord will have to pay an eye-watering fine of up to £30,000.

Moving house in the future

Few landlords or letting agents are willing to charge these illegal fees now that the consequences are so high, though you should stay vigilant whenever you move into a new property to make sure you’re not paying anything you shouldn’t be. 
 

Whenever you’re set to move house make sure you leave a review for your previous property and landlord with us here on Marks Out Of Tenancy, that way you can make sure others are made aware of the home they’re about to make for themselves, especially if you were forced to pay hidden or illegal fees!

If you’re a tenant and want further information on the Tenant Fees Act of 2019, check out this official government guidebook for tenants