The last two years have seen several key changes to landlord and tenant legislation.
As always, it is important to keep up to date as not doing so can have consequences for you and your tenancy.
Use our checklist below to make sure you remain compliant.
Electrical safety standards and EICR certificates
As of the 30th July 2020, all new tenancies have required a satisfactory EICR (electrical installation condition report). As of the 1st April 2021, all existing tenancies will require a current EICR, irrespective of whether the tenancy is new or not. An EICR usually lasts for five years, and the property will not need a reinspection before this date.
EPC and the minimum energy efficiency standards
From the 1st of April 2020 landlords have been prohibited from starting a new tenancy, or continuing an existing one where the property has an EPC rating of E or below. Some properties may be exempt from this legislation, confirmation needs to be sought from your local authority.
As the EPC first came into existence in 2008, many have now expired. Don’t forget to ensure that your EPC is still valid, as failure to provide a valid certificate to your tenant when they move in can prevent the serving of a section 21 notice to regain possession (see more details below).
Gas safety certificates
Landlords are responsible for the gas safety of their properties, and privately renting a property without a valid gas safety certificate is a criminal offence. Gas safety certificates need to be renewed annually, irrespective of whether the tenancy is new, renewed, or continuing. Failure to provide a valid GSC will also prevent you from serving a section 21 notice.
Serving a Section 21 notice
To successfully serve a section 21 notice and regain possession of your property, several key documents must have been issued to the tenant to ensure the notice is valid. Failure to provide some or all of these things will prevent you from being able to utilise section 21, and in some cases mean you will not be able to gain possession until the tenant voluntarily moves out.
- Valid gas safety certificate (if applicable)
- Current EPC
- Proof that the tenant’s deposit has been protected within 30 days of receiving it
- Prescribed information relating to the deposit
- For recent tenancies, a copy of the Governments ‘How to rent guide’
- In addition, if your property requires a local or HMO license, the section 21 notice cannot be served unless this is in place.
Changes to landlords’ taxation
From 1st April 2020, several new pieces of legislation have come into force affecting landlords’ taxation.
Landlords are no longer able to claim tax relief on mortgage interest payments for their rental income. Capital gains relief for landlords that used to live in the property subject to CGT is no longer applicable (unless they share the home with their tenant), and CGT on any property sale must be paid to HMRC within 30 days of completion, rather than waiting to file as part of an annual tax return.
Non-resident landlord taxation
Landlords based outside of the UK now need to register both themselves and their managing agent with HMRC. The managing agent also needs to register separately. Once confirmed with HMRC, the landlord is able to file an annual tax return as normal. Until then, 20% of all rental income must be half back by either the managing agent or the tenant and sent to HMRC quarterly.
Please note that this is by no means a definitive guide to all compulsory legislation, and only really reflects recent changes. Further legislation is in place relating to fire safety, smoke and carbon monoxide alarms, and fitness for human habitation amongst others. If you need any further guidance please feel free to get in touch or take a look at our comprehensive e-guide, here.
