The UK Tenant Fee Ban will Become Law on 1 June this Year

Here's our client briefing

By: Tony Coe, Founder & CEO


The Tenant Fee Ban in the UK will become law on 1 June 2019.

Our CEO, Tony Coe’s video above gives a quick summary of the new law’s main features.

To recap, we supported the ban because Letting Agents, who ONLY represent landlords’ interests - and who earn substantial commissions from their client landlords - should not ALSO be entitled to demand fees from renters.

The government adopted our position. The new law will ban agents and landlords from charging fees to renters except in very limited circumstances.

And the new law has gone even further than that in our direction.

Here are some highlights of the ban:

Security Deposits will be capped at 5 weeks’ rent for annual rents up to £50,000.  If the rent is over £50,000 then the limit is 6 weeks.

The landlord can’t go above these caps for any reason, even if, for example, the tenant has pets.

Deposit replacement products will be allowed - this is where a renter pays a one-off, non-refundable fee instead of a cash deposit - but they will only be allowed if they are an option.  Renters can’t be forced to buy one.

Tenants must not be charged any fees for referencing or inventories or administration.  Guarantors cannot be charged either.

Fees to tenants will no longer be allowed for renewing or extending leases.

Ban Fee UK tenantsFees that can be charged are very limited:

  1.  If the tenant loses the keys
  2. If the tenant falls into rent arrears by more than 14 days (limited to 3% over Bank of England Base Rate) but fees must not be charged for writing letters for rent arrears.  
  3. If there is a change of named tenant
  4. If there’s a surrender by the tenant.  

The new law only applies to TAs signed on or after 1 June 19.  

There will be transitional provisions that will apply to TAs signed prior.  

Company lettings - that is where a company is the tenant - are exempt from this new law.  

So, for example, where your company as the employer takes the lease in its name rather than the assignee’s, the tenant fee ban will NOT apply.

The trade body for letting agents has itself admitted that a lot of agents will simply ignore the new law in hopes that they will get away with continuing to demand fees.

For this reason, it’s important to make sure that ALL your UK renters are given access to advice and representation in some form - even if that’s only access to a basic desktop support service - which is one of the entry-level services we offer.

We will be keeping a close eye on the official guidance that will be issued by the government in the run-up to the introduction of the new law - and we’ll keep you posted if you’re receiving our regular bulletins.

In the meantime, if you have any questions, please do get in touch with us here at Saunders 1865.