By Lynne Swanson, Legal Executive, Percy Hughes & Roberts Solicitors
It can be very rewarding to be a landlord and, when you have a great relationship with your tenants, it can feel like a very easy way to earn a living. However, as straightforward as it can seem, there are significant legal responsibilities you must uphold as a landlord in the UK, and important obligations you must fulfil. The consequences if you fail to do so can be extremely serious, ranging from fines and other legal penalties to a need to pay compensation to tenants.
Unfortunately, there are many small and seemingly insignificant mistakes that can cost landlords dearly and, as experts in advising, representing and defending landlords in court, we have experienced many of them first-hand. Here, the longstanding landlord law team at Percy Hughes & Roberts Solicitors explains some of the most common mistakes you can make when managing a rental property, the potential legal consequences you could face, and the steps you can take to ensure that you do not fall afoul of the law.
Complete your pre-rental checks.
Landlords have a legal responsibility to ensure that anyone over the age of 18 who pays to live in their property has the legal right to reside in the UK. If you do not carry out these checks thoroughly, you will fall afoul not only of landlord regulations, but also immigration law. Renting to someone who does not have leave to reside in the UK, or whose leave to stay has expired, can result in a civil penalty and a fine of up to £1,000 for a first offence, or £3,000 for further offences.
Thankfully, the government has published detailed guidance that can help landlords to ensure they meet this requirement. The landlord's guide to ‘right to rent’ checks explains what documentation you should request from tenants and how to interpret it. It also has information on what to do if you have reason to believe that your tenant’s documents are fake or illegitimate in some way.
Once you have determined that your tenant has the legal right to rent in the UK, you will also be responsible for carrying out follow-up checks, either at the end of your tenant’s permission to stay in the UK, or 12 months after your initial check. While some landlords feel that there is little risk in not carrying out or following up on these checks, the penalties can be even more severe if your tenant’s leave to remain in the UK runs out, and you do not report this to the Home Office. Alongside the fines that we have already mentioned, you may receive a sentence of up to five years in prison.
As well as carrying out checks on your prospective tenants before you provide a tenancy agreement, you should also perform some checks on the property itself. For example, you need gas and electrical safety certificates for every appliance in your rental property, and may need to provide copies of these to your tenant. Before a new tenant moves in, have all of your appliances tested for compliance and ensure that everything is safe and in good working order.
Provide the correct information
There are several key pieces of information you need to provide tenants when they move in. This includes a valid Energy Performance Certificate and a copy of the government’s ‘How to Rent’ guide, the latter of which can be sent via email. You should also ensure that your tenancy agreement is fit for purpose and suits your specific requirements - for example, you should determine whether a break clause or other provisions are appropriate, and identify who will be responsible for maintenance of the property, so that these can be included in the contract.
The other important consideration is to secure the tenant’s deposit in a deposit protection scheme within 30 days of receipt. Failure to do so can result in a court order to pay back the tenant up to three times their initial deposit, and to cover their court costs if they take legal action against you. Alongside the documents we have detailed above, you must also provide your tenant with information about the deposit protection scheme you have used.
Check the process before an eviction
If you want to bring a tenancy agreement to an early end, you may be able to carry out an eviction. However, there are very specific rules governing how and when evictions can be carried out, and these are generally designed to uphold the rights of tenants, rather than landlords. As such, it is vital to ensure that you follow all of the necessary procedures correctly in order to ensure that your eviction is able to move ahead. Otherwise, a court may rule that you cannot evict your tenant, and this can lead to problems like a strained landlord/tenant relationship, or a need to try again and take further legal action.
Typically, if you evict a tenant either at the end of a tenancy agreement, you can do so without needing to provide a reason. However, if you want to evict the tenant before the agreement has ended, you must rely on legal grounds to do so. For example, you may be able to evict a tenant who has used the property for an illegal purpose, or who owes a significant amount of rental arrears. However, you cannot simply say that you want to take back control of the property, as this is not a legally valid cause for eviction.
Choosing the right type of eviction notice, providing your tenant with sufficient notice to move out of the property, and following procedures correctly throughout can be difficult, but it is vitally important to do so. For this reason, working with an expert landlord solicitor to support you during the eviction process can be the difference between success and failure - not only this, but you can face legal penalties if you enter your property without properly notifying your tenant, or for a wealth of other reasons. Guidance from a solicitor throughout your tenancy can ensure that you uphold your rights and keep your property and business secure while maintaining your tenants’ rights and avoiding falling on the wrong side of the law.
Author: By Lynne Swanson, Legal Executive, Percy Hughes & Roberts Solicitors