The Tenant Fees Act 2019, as of 1 June 2020 applies to all tenancies and statutory periodic tenancies entered into before 1 June 2019. This means that any term in a tenancy agreement which requires a prohibited payment can no longer have effect and any landlord or agent who demands and receives such a payment will be in breach. If the payment is made by the tenant by mistake, it must be returned within 21 days.
If the landlord is in breach (even via their agent), then no section 21 notice can be served. There is also the prospect of a fine of £5000 or up to £30,000 on repeat offences, having to repay the payment and banning orders
The Tenant Fees Act bans most letting fees and caps tenancy deposits paid by tenants in the private rented sector in England.
The act came into force from 1 June 2019 for all new tenancies, however from June 1st 2020 the act covers all tenancies meaning those entered into prior to and after 1st June 2019.
The only payments that landlords or letting agents can now charge to tenants in relation to all tenancy contracts are:
- rent
- a refundable tenancy deposit capped at no more than 5 weeks’ rent where the total annual rent is less than £50,000, or 6 weeks’ rent where the total annual rent is £50,000 or above
- a refundable holding deposit (to reserve a property) capped at no more than 1 week’s rent
- payments associated with early termination of the tenancy, when requested by the tenant
- payments capped at £50 (or reasonably incurred costs, if higher) for the variation, assignment or novation of a tenancy
- payments in respect of utilities, communication services, TV licence and Council Tax
- a default fee for late payment of rent and replacement of a lost key/security device giving access to the housing, where required under a tenancy agreement
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