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Compulsory Electrical Certificate goes live this Summer 2020

Compulsory Electrical Certificate goes live this Summer

The Government has proposed detailed regulations for enforcing mandatory five-year electrical safety checks in the private rented sector from July this year. 

The Electrical Safety Standards in the Private Rented Sector (England) Regulations 2020 were laid in Parliament yesterday. They require approval from both the House of Commons and the House of Lords before they come into force. 

We have written to the Government to highlight unintended consequences that could arise from the current definition of the electrical safety standards. As it stands, the current draft could mean that almost all properties will not meet the new standards and properties built before mid-2019 will need to perform unnecessary installation work. Our proposals, also stress the need to ensure that there are enough qualified people to do the work.

New requirements for mandatory electrical safety checks 

The draft regulations propose that, from 1 July 2020, all new private tenancies in England will need to ensure that electrical installations are inspected and tested by a qualified person before the tenancy begins. The landlord will then need to ensure that the installation is inspected and tested at least every five years – and more often if the most recent safety report requires it. 

For existing tenancies, an electrical safety test will need to be carried out by 1 April 2021, with regular tests following this as outlined above. 

The regulations will apply to all properties across the private rented sector, including houses in multiple occupation (HMOs), although lodger arrangements where the tenant shares accommodation or amenities with the landlord or their family are excluded. These regulations will replace the existing requirements for HMOs regarding electrical installation testing and inspection.  

A ‘qualified person’ for the purposes of these regulations is a person competent to undertake the inspection and testing required and any further investigative or remedial work in accordance with the electrical safety standards. 

Local authorities can impose a financial penalty of up to £30,000 for a breach of the regulations. Where there are multiple breaches, the local authority can impose multiple penalties. 

Electrical safety reports 

Once the electrical installation has been tested, the landlord must: 

  • Ensure they receive a written report from the person conducting the inspection, which includes the results and the required date for the next inspection 
  • Supply a copy of this report to each existing tenant living in the property within 28 days of the inspection 
  • Supply a copy within seven days to the local authority, if they request a copy 
  • Keep a copy of the report until the next inspection, and give a copy to the person undertaking the next inspection. 

For new tenancies, the landlord must: 

  • Give a copy of the most recent report to a new tenant before the tenant occupies the property 
  • Give a copy of the most recent report to any prospective new tenant who requests the report in writing, within 28 days of receiving such a request. 

Remedying any faults 

If the electrical safety report identifies a fault or potential fault, which the landlord must either investigate further or repair, the landlord must ensure further investigations or repairs are completed by a qualified person within 28 days of the inspection, or within the timeframe set out in the report if this is shorter. 

Following these further investigations or repairs, the landlord must ensure they receive written confirmation that these have been carried out and that either the electrical safety standards are met, or further work is required. 

This confirmation must be supplied to each existing tenant and to the local housing authority within 28 days of the work being undertaken, along with the original report identifying further work is required. 

This process must be repeated until the electrical installation is found to be compliant. 

Enforcement 

If a landlord breaches the above requirements, the local authority has a duty to act. Where urgent works are not required, the local authority must serve a ‘remedial notice’ on the landlord. This must be served within 21 days of the local authority deciding it has reasonable grounds to act. The landlord will have 28 days from the date of service of the notice to take the action outlined, or must make written representations within 21 days if they disagree with the notice. 

Once the landlord has made written representations, the remedial notice is suspended until the local authority responds – which must be within seven days. If the local authority confirms the notice, the suspension ceases, and the landlord has 21 days to comply with the requirements. 

If the tenants of the property refuse access to the landlord for these remedial works, the landlord will not be considered to have breached this duty purely because they have not brought legal proceedings to access the property. 

If the landlord does not undertake the remedial works, the local authority can access the property with the tenants’ permission to remedy the issue. The local authority must serve notice to the landlord informing them of this action – to which the landlord can appeal to the First-tier Tribunal. Local authorities can also recover costs reasonably incurred from the landlord. 

Where urgent remedial works are required and the landlord has not undertaken these, the local authority can arrange for the works to be undertaken. The local authority must inform the landlord within seven days of the works commencing. 

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Tenant Fee Act 2019

What you need to know about the Tenant Fees Act 2019 – how will it impact tenancy deposits?
– May 2019
by Millie Wickens

From 1 June 2019, the Tenant Fees Act comes into force, prohibiting landlords and agents from charging any fees to tenants, other than those ‘permitted’ by the Act. Any tenancy that is signed on or after 1 June must adhere to the new regulations.

Who does the act apply to?

The Tenant Fees Act applies to assured shorthold tenancies, student accommodation tenancies and licences to occupy housing in the private rented sector.

The act only applies to landlords, agents and tenants in England.

Letting fees are already banned in Scotland and, while they are currently still legal in Wales and Northern Ireland, a ban was put before the Welsh government in June 2018 and is intended to commence this September.

What fees can be charged?

There are a number of fees that are ‘permitted’. These include:

  • Rent
  • A refundable holding deposit (up to one week’s rent per property)
  • Tenancy deposit (exclusions apply, see below for more information)
  • Changes to the tenancy (for example, introduction of a pet, permission to run a business from the property or other amends that change the contractual responsibilities. This is capped at £50 per change unless the landlord is able to prove that the resulting cost was higher AND is reasonable)
  • Utilities (electric, gas, water)
  • Council tax, TV licence fees, communication fees (e.g. telephone, broadband etc.)
  • Fee for early termination of tenancy/surrender fee – the landlord must be able to show reasonable loss has been suffered, for example as a result of referencing, re-advertising and can charge rent until the next tenant moves in
  • Default fees which should be written into the tenancy agreement for:
    • late payment of rent – this can only be after 14 days have passed and interest at a maximum of 3 per cent above base rate
    • replacing locks/security fobs. The Guidance states, for example, that a new standard door key could be valued between £3-£10, a specialist door key between £5-£20 or a replacement key fob up to £50; there may be circumstances where it is necessary to pay more and ALL claims must be supported by evidence from the landlord of costs and be reasonable

What fees are prohibited under the act?

Any fees not listed on the government’s ‘permitted’ fees list are prohibited. Landlords and agents are NOT able to charge fees for:

  • Property viewing
  • Referencing
  • Administration charges
  • Guarantors (this can be a condition of the tenancy but you cannot charge fees for meeting this condition)
  • Inventory checks (both check in and check out)
  • Right to Rent checks (the landlord or agent are liable for this cost, unless the tenant fails the check)
  • Pet fees/deposits
  • Renewal/exit fees
  • Interest on permitted payments
  • Professional end of tenancy cleaning – as a special clause (breach of contract ONLY)
  • Third party fees (unless the tenant chooses to undertake the services themselves)
  • Gardening services (unless included within the rent) 

For a full list of permitted and prohibited fees please visit the GOV.UK website for guidance.

Changes to tenancy deposits

As part of the Tenant Fees Act 2019, the amount of tenancy deposit that a landlord or agent can request will be capped and dependent on the total annual rent for the property.

If the total annual rent is less than £50,000, landlords and agents are only permitted to ask tenants to pay up to five weeks’ rent.

If the total annual rent exceeds £50,000 and is below £100,000 then landlords and agents can request up to six weeks’ rent from tenants as a tenancy deposit.

Any deposit taken from a tenant must be protected in one of the three government backed tenancy deposit protection schemes, such as mydeposits, within 30 days of the payment being taken.

GOV.UK advise that you are able to calculate the total annual rent by using the following formulae:

  • total monthly rent x 12
  • total weekly rent x 52

You can also calculate the total weekly rent using one of the following formulae:

  • (your monthly rent x 12) ÷ 52
  • your annual rent ÷ 52

Read more about the tenancy deposit cap in our latest guide.

What are the penalties for non-compliance?

Penalties for non-compliance are clear and severe. It is therefore important to understand what fees are permitted and remind yourself that if a fee is not on this list, IT IS PROHIBITED.

Breach of legislation will usually be a civil offence carrying a financial penalty of up to £5,000 per fee. Despite this, if a further breach is committed within five years of a financial penalty or if there is a conviction for another breach, this becomes a criminal offence.

The penalty imposed for a criminal offence – a banning order offence under the Housing and Planning Act 2016 – is an unlimited fine.

According to GOV.UK “Where an offence is committed, local authorities may impose a financial penalty of up to £30,000 as an alternative to prosecution.” It is down to the local authority’s discretion as to whether they wish to prosecute or impose a financial penalty.

Failure to repay a tenant’s holding deposit will be treated as a civil offence and carries a penalty of up to £5,000.

In addition, landlords and agents who have charged an unlawful fee will not be able to evict a tenant until they have repaid these fees. Failure to comply with the legislation can therefore have serious ramifications. Penalties will be enforced by trading standards and tenants have the ability to apply to the First Tier Tribunal for a refund of a prohibited fee.

If in doubt it is advisable to seek clarification from GOV.UK. In addition, landlords, letting agents and tenants can read the government’s comprehensive ‘Tenant Fees Act 2019: guidance’ here.