Important changes to lettings legislation

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11 Oct 2016

The latest lettings legislation

Author: Michael Cook

Property might be one of the most financially rewarding investments, but the market has seen a surge of legislation changes in recent months, and private landlords are now most at risk of facing fines.

The on-going changes mean it is more important than ever for landlords to understand the regulations fully and to work with an established lettings agency that will protect their investment and tenants, ensuring they are adhering to the law.

Romans’ lettings experts have reviewed the recent changes and highlighted some key things to look out for:

Lettings legislation changes in 2016 and beyond

Right to RentRight to Rent

At the beginning of the year the Right to Rent scheme launched across the whole of England. Any landlords housing tenants that do not supply valid documents to satisfy the requirements of the Immigration Act 2014 now face up to £3,000 worth of fines per person.

Find out more about the Right to Rent scheme

EPC legislationEPC

Tenants are now able to request consent from their landlords to carry out energy efficiency improvements to privately rented properties, and landlords are not able to unreasonably refuse consent.

Learn more about the EPC legislation changes

New dividend allowanceDividend Allowance

From April 2016 the Dividend Tax Credit was replaced with a new tax-free Dividend Allowance.

The Dividend Allowance means that you won’t have to pay tax on the first £5,000 of your dividend income, no matter what non-dividend income you have.

You’ll pay tax on any dividends you receive over £5,000 at the following rates:

  • 7.5% on dividend income within the basic rate band
  • 32.5% on dividend income within the higher rate band
  •  38.1% on dividend income within the additional rate band

See the Dividend Allowance Factsheet

Wear and tear allowanceWear and tear

The new ‘wear and tear allowance’ only allows landlords to get tax relief when replacing furnishings.

Before, landlords could claim wear and tear allowance even if there had been no actual expenditure, but the new allowance only enables landlords to deduct the costs they actually incur on replacing furnishings in the property. The positive news is that all landlords, whether you let a furnished or unfurnished property, can now make claims.

Minimum energy efficiency standards – April 2018EPC

From April 2018 there will be a requirement for any rental properties to have a minimum energy performance rating of E on an Energy Performance Certificate (EPC). A penalty of up to £4,000 will be imposed for breaches of this regulation.

The regulations will come into force for renewals of tenancies and new lets from 1st April 2018 and for all existing tenancies on 1st April 2020.

Letting Service Options

And in case you missed them, here are some of the lettings legislation changes from 2015

Smoke and carbon monoxide alarmsSmoke and carbon monoxide alarms

In October 2015 new smoke and carbon monoxide alarm regulations were put in place and failure to comply can result in a £5,000 fine.  A smoke alarm must be fitted in each storey of the property and carbon monoxide detectors must be installed in any room with a solid fuel burning combustion appliance.

Find out more about the smoke and carbon monoxide alarm regulations

Deregulation Act 2015 (Section 21)Deregulation Act

The Deregulation Act 2015 contains a number of changes that affect residential landlords, most importantly Section 21. Incredibly, many landlords and even some agents are still unaware of the Section 21 changes.

Section 21 notices are served upon the tenant by the agent/landlord to determine the tenancy to enable the landlord to gain possession of the property.  A landlord can no longer serve a Section 21 notice within the first four months of the contractual term of the tenancy.

Learn more about the Section 21 notice

Legionnaires’ disease assessments

Legionnaire's Disease

Residential landlords are now responsible for conducting risk assessments in order to help combat Legionnaires’ disease. This is a serious lung infection caused by Legionella bacteria infecting your lungs, and it's usually caught by breathing in small droplets of contaminated water. For more information about Legionnaires’ disease visit

Please note that it is the sole responsibility of Romans’ landlords to arrange a Legionella Risk Assessment prior to any tenant taking occupation, including managing any risk.

So how can landlords stay on top of the legislation changes?

Working with a licensed letting agent will help ensure you’re always kept up to date with the latest legislation changes and your rental properties are compliant with the law.

If you're just looking for tenants or you would like to take a back seat, Romans offer four services options where we can be involved as much or as little as you'd like - by taking up one of these options gives you complete peace of mind that you are legally compliant and lettings regulations are being adhered to.

To experience our 5 star Feefo rated service speak to one of our expert letting agents today on 03339 205 493

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