Important Information for Landlords 2015

Samuel & Son offer a comprehensive residential lettings service specialising in rural and village houses and cottages and landed residential property. We offer a friendly and professional service to guide you through the sometimes complex procedures and legal obligations that you as a Landlord have in letting your property.

RESIDENTIAL LETTINGS
The Samuel & Son lettings team have extensive local market knowledge and specialise in rural and village houses and cottages and landed residential property.  As well as offering residential tenancy services, we also deal with agricultural farm tenancies and grazing licences as well as rural commercial lets.

As members of the Royal Institute of Chartered Surveyors you can rest assured that you and your property are in safe hands.   Professional integrity is at the core of our service and you can be guaranteed of a highly expert, friendly and personal service to guide you through the sometimes complex procedures and legal obligations that you as a Landlord have in letting your property.   We are regulated by a RICS strict code of conduct and are also registered with The Ombudsman Service: Property.

Below we provide guidance and information for Landlords concerning the current safety regulations and legal requirements when letting a property.  Please call us if you would like to discuss your individual property and arrange a property appraisal.

Read our full Samuel & Son Landlord’s Guide here.

IMPORTANT INFORMATION FOR LANDLORDS 2015
HEALTH & SAFETY AND OTHER LEGAL REQUIREMENTS

Before you let your property you must make sure that it and its contents comply with the following regulations and that you have adhered to the correct legal procedures.  It can be a criminal offence to neglect these responsibilities and may affect your ability to take back your property at the end of a tenancy.

Cooking_gasGAS SAFETY
The Gas Safety (Installation & Use) Regulations 1988 enforced by the Health & Safety Executive (HSE) are designed to ensure that Landlord’s fulfil their legal duty to ensure that gas installations, appliances, fittings and flues provided for tenants are safe.  It is a Landlord’s legal responsibility to ensure that all the property’s gas appliances and fixed installations are maintained in good order and checked for safety at least every 12 months by a Gas Safe Registered Engineer who will then provide a Gas Safety Certificate (CP12).  A copy of the Certificate must be given to any new Tenant before occupation commences.  Installing a Carbon Monoxide (CO) alarm is also highly recommended by HSE too.

ELECTRICAL SAFETY
Whilst there is no statutory requirement to have annual safety checks on electrical equipment as there is with gas, there is a legal requirement for the landlord to provide a safe building.  It is the Landlord’s responsibility to provide instruction manuals for all items of electrical equipment provided as part of the let and for ensuring that all electrical appliances within the property comply with the Electrical Equipment (Safety) Regulations 1994 imposing a duty on the Landlord as ‘supplier’ to ensure that all mains electrical equipment, new or second-hand, supplied with the accommodation is ‘safe’.  The Plugs and Sockets (Safety) Regulations 1994 require that where any plug, socket or adaptor supplied is intended for domestic use, it complies with the current standards.

We recommend regular checks of all electrical wiring and appliances by an NICEIC registered electrician.  Two tests to consider are the Electrical Installation Condition Report (EICR) which confirms as far as reasonably practicable, whether or not the electrical installation is in a satisfactory condition for continued service, and Portable Appliance Test (PAT).   Any electrical appliances in the property must carry the British Standard Kitemark (BSI) or the European Safety Standard (BEAB).

FURNITURE & FURNISHINGS SAFETY
Any furniture and furnishings supplied in rented property must comply with the Furniture & Furnishings (Fire) (Safety) Regulations 1988, (as amended in 1989, 1993 and 2010) and must carry a permanent and non-detachable manufacturer’s ‘fire resistant’ label.  The regulations apply to a wide range of items including arm chairs, sofas, beds, garden furniture that could be used indoors, stretch and fitted covers for furniture, scatter cushions and seat pads.  The regulations do not apply to some items including furniture manufactured before 1950, curtains and carpets.

Smoke-DetectorSMOKE & CARBON MONOXIDE ALARMS
Under the Building Regulations 1991 and the Smoke Detectors Act 1991, any property built since June 1992 must have mains fitted smoke alarms with battery back up on each floor of the property.    .

The Smoke and Carbon Monoxide Alarm (England) Regulations 2015 that came into force on 1st October 2015 require Landlords to have at least one smoke alarm fitted on every storey of their properties and a carbon monoxide detector in any room containing a solid fuel burning appliance (e.g. a coal fire, wood burning stove), regardless of the age of the property.

The Landlord must ensure that all alarms fitted in the property are in full working order at the start of a Tenancy and should make provision in the tenancy agreement for the tenant to regularly test the alarms and immediately report  to the Landlord any defect.

OIL, LPG, SOLID AND WOOD BURNING STOVES
Oil, LPG, solid fuel appliances and wood burning stoves should be serviced and checked annually.  Wood burning stoves installed from 2011 must have an Installation Certificate and an associated carbon monoxide alarm fitted.

CHIMNEYS
Landlords must ensure that at the start of a tenancy, chimneys and flues for solid fuel heating are swept and unobstructed.  Thereafter a tenant can be made responsible for regular chimney sweeping under the terms of the tenancy agreement but we would recommend that in some situations, Landlords may consider managing this aspect of the property themselves.

WATER SAFETY
Although an individually rented house or flat generally poses no greater risk for Legionnaires’ disease than an owner occupied property, there is still a risk which must now be addressed by all Landlords and their agents.  In order to comply with the Health and Safety Executive’s Code of Practice, in some situations, Landlords are advised to carry out a risk assessment at their premises prior to letting where there are open water tanks, cooling systems or a swimming pool.

 ‘RIGHT TO RENT’ IMMIGRATION CHECKS
Under the Immigration Act 2014, private landlords will have to check the right of prospective tenants to be in the country if they want to avoid potentially being fined.  Landlords will need to see evidence of a person’s identity and citizenship, for example a passport or biometric residence permit. Many responsible Landlords already do this as a matter of routine, and most legal renters will have the correct documentation ready to hand. In most cases Landlords will be able carry out these simple checks without need to contact the Home Office.  This legislation rolled out on the 1st of December 2014, but only to a select few areas in the West Midlands (Birmingham, Walsall, Sandwell, Dudley and Wolverhampton), but it will roll out to the rest of the country sometime during 2015.


EPC Houses FlatENERGY PERFORMANCE CERTIFICATES
Since 1st October 2008, under The Energy Performance Of Buildings (Certificates And Inspections) (England And Wales) Regulations 2007 most residential Landlords (and most commercial Landlords) are legally obliged to provide an Energy Performance Certificate, to be available to all prospective Tenants upon request, from the start of marketing.  The Certificate will rate your property’s energy performance and make recommendations for improving it.  The certificate will be at the Landlord’s expense and will be valid for 10 years.  Samuel & Son can arrange the inspection and certificate for Landlords through our government accredited Domestic Energy Assessor.  The cost is normally around £60 plus VAT.  Please call us on 01435 864020 with your property details and we can arrange for an accurate quotation.

New Energy Performance Regulations 2015
The Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 have now been passed, phasing in two obligations for Landlords concerning the energy efficiency of properties that are rented.

Minimum Energy Performance Rating
From 1st April 2018 all rented property (both domestic and non-domestic) must have a minimum EPC rating of ‘E’.  The regulations will come into force for new lets and renewals of tenancies with effect from 1st April 2018 and for all existing tenancies on 1st April 2020.  It will be unlawful to rent a property which breaches the requirement for a minimum ‘E’ rating, unless there is an applicable exemption.  A civil penalty of up to £4,000 will be imposed for breaches.  Exemptions include properties that do not presently require an EPC, such as listed buildings.

Tenants’ Energy Efficiency Improvements
From 1 April 2016 a tenant in a private domestic rented property will be allowed to reasonably ask their Landlord for a relevant energy efficiency improvement.  The Landlord will not be able to unreasonably refuse consent but no upfront costs should fall on the landlord, unless the landlord agrees to contribute.  Landlords will not be obliged to make improvements unless there is a grant available under a Government or Local Authority finance initiative, Energy Company Obligation or similar.

DPSTENANCY DEPOSIT PROTECTION
Since the 6th April 2007, by law, Landlords must secure their tenants’ deposits for Assured Shorthold Tenancies (AST) into one of three government approved Tenancy Deposit Protection (TDP) schemes.  Of the three schemes, if Samuel & Son are instructed to hold the Deposit for an AST, our chosen provider is the Deposit Protection Service (DPS).   All deposits must be submitted and paid into the scheme within 30 days of receipt of the deposit.  The Tenant will then receive notification from the DPS by post or email that the deposit has been safely received.  At the end of the tenancy, if the Landlord and Tenant agree how the deposit should be repaid, they will tell the scheme what they have agreed and the money will be re-paid accordingly.  Should there be any dispute over the deposit at the end of the tenancy, the DPS will hold the amount until the Dispute Resolution Service decides what is fair.

THE DEREGULATION ACT 2015
The Deregulation Act 2015 has introduced important changes regarding section 21 notices.  As part of this, The Assured Shorthold Tenancy Notices and Prescribed Requirements (England) Regulations 2015 came into force on 1st October 2015.  Changes will affect all new and renewal tenancies created on and beyond this date.  Existing tenancies including those continuing on a statutory periodic basis will presently be unaffected by these changes but will be subject to the new regulations from 1 October 2018.

The Regulations place a number of requirements on Landlords before a section 21 notice can be validly served.  From 1st October Landlords must provide the Tenant with the following prescribed information at the start of the tenancy:

  • A copy of “How to rent: the checklist for renting in England” supplied by the government to help landlords and tenants understand their rights and responsibilities, and what to do should things go wrong
  • A valid Energy Performance Certificate (EPC)
  • A gas safety certificate
  • Tenancy deposit prescribed information (within 30 days of receipt of deposit).

While the first item is the only new requirement, failure to provide all of the above, and prove that they were provided to the tenant, may now prevent landlords from being able to issue a valid notice for possession at the end of the rental term.

In relation to serving section 21 notices:

  • Landlords can only serve a section 21 notice after 4 months of the first tenancy and there is a 6 month time limit after which a section 21 notice expires
  • The section 21 notice can expire on any day and does not have to end on the last day of a period of the tenancy provided that the necessary period of notice is given
  • In relation to the above, provision has been made for the refunding of rent paid in advance where a tenancy is terminated part way through a payment period
  • The section 21 notice has to be in the new ‘prescribed form’
  • Any health and safety improvement notice served by the local authority means no section 21 notice can be served for 6 months.

As regards the last point, this has been introduced to prevent so-called retaliatory or revenge evictions where a Landlord serves notice to terminate a residential tenancy after the Tenant has made a complaint about the condition of the property.  The Act sets out procedural guidance for handling a Tenant’s complaints in relation to the condition of the property and what an ‘adequate’ response from the Landlord entails.

MAINTENANCE OF THE PROPERTY DURING THE TENANCY

Landlord’s Obligations
The Landlord’s maintenance obligations for a rented property are set out under Section 11 of the Landlord and Tenant Act 1985 and under this legislation the Landlord is responsible for:

  • the structure and exterior of the dwelling, including drains, gutters and external pipes,
  • the installations for the supply of water, gas, electricity and sanitation (including basins, sinks, baths and sanitary conveniences), and
  • the installations in the dwelling for the supply of space heating and water heating.

Tenant’s Responsibilities
The law implies a condition into every tenancy agreement that the tenant must use their home in a ‘tenant-like’ way. Generally, this means the Tenant should:

  • report any disrepair or problems immediately to the Landlord
  • do minor repairs, such as changing fuses and light bulbs
  • keep the home reasonably clean
  • not cause any damage to the property and make sure visitors do not cause any damage
  • use any fixtures and fittings properly
  • keep the property reasonably warm and aired to help prevent condensation or freezing pipes
  • ensure the property is secure when absent from it
  • keep the garden and outside areas tidy and free from rubbish.

Fair Wear & Tear
In association with the above and specifically as regards Tenant deposits, Landlords must make an allowance for ‘fair wear and tear’.  The law defines fair wear and tear as ‘reasonable use of the premises by the Tenant and the ordinary operation of natural forces’.

In practice, this essentially means making an allowance for:

  • the original age, quality and condition of any item at commencement of the tenancy;
  • the average useful lifespan to value ratio (depreciation) of the item;
  • the reasonable expected usage of such an item;
  • the number and type of occupants in the property;
  • the length of the tenant’s occupancy.

COUNCIL TAX AND UTILITY ACCOUNTS
The Tenant is generally responsible for all charges for electricity, gas or oil (where applicable), water and council tax for the duration of their tenancy. They must also pay for any telephone and internet connections, satellite/cable services, and a television licence where applicable. A Landlord is not expected to provide internet, satellite or cable facilities within a property, although provision of a standard telephone line is strongly recommended. It is the tenant’s responsibility to find out if these services are available prior to renting a property. Any utility charges between tenancies remain the Landlord’s responsibility.  The Landlord has a legal responsibility to notify the Local Authority of any change in occupancy at the property.

CONSENT TO LET

Proof of Ownership
It is an offence for us to let the property without the Landlord’s written consent and we therefore need proof of property ownership and for the Landlord(s) to sign our Terms of Business.    If you are acting on behalf of the legal owner, or there is a joint owner, we will require evidence that the owner or joint owner has agreed to let the property.

Money Laundering Regulations
In order to comply with The Money Laundering Regulations 2007, and to satisfy our client due diligence requirements we do carry out client identification and verification checks on our Landlords.  Generally this is very straightforward and we will ask for you to produce original documents confirming your identity and address.

Insurance
You should check that you are suitably covered for letting on your Buildings & Contents Insurance.  Failure to advise your insurers may invalidate your policies.  Additionally you may consider optional cover including Landlord’s Liability, Legal Expenses and Revenue Protection.  The Tenant is responsible for insuring their personal possessions and household contents.

Mortgages
If your property is mortgaged you should ensure that you have obtained the mortgagee’s consent to let the property.  If you do so without the lenders permission, you may be in breach of the terms and conditions of the mortgage.

TAX 

HMRC TaxTax on Rental Income
For UK resident Landlords, Income Tax is payable on rental income and for private Landlords should be declared on a Self-Assessment Tax Return.  Most expenses arising from letting the property can be offset against rental income and reduce your tax liability.  Typical costs include professional fees, repairs and maintenance and buildings and contents insurance so keep all receipts and invoices.  It may be advisable to contact an accountant to find out more or further information can be obtained from HM Revenue & Customs website.

The legislation differs for non UK resident Landlords (those who live abroad for 6 months or more per year).  Landlords can pay rent on income through Self-Assessment on applying to HMRC in order to receive gross rental income.  However if a Landlord does not apply, any agent collecting rent on their behalf is legally obliged, under the Finance Act of 1995, to deduct the current rate of tax from the rental income and pay it over to the Inland Revenue.

Please call us if you would like any further information on our lettings services.

Read our full Samuel & Son Landlord’s Guide here.
Tenancy Ag Keys