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New Responsibilities for Landlords

New Responsibilities for Landlords

By: S Twose

Tags: Buy To Let, Property, Landlord

Are you a landlord, or considering becoming one?
From 1st February this year, the government has given Landlords in England new legal obligations, imposed under the Immigration Act as part of the Government’s plans to tackle illegal immigration. The new legislation is intended to make it more difficult for people who are in the country illegally, to work or to rent property, in order to make it harder for them to stay in the country. However, the responsibility for implementing the new rules lies with individual landlords.
According to a recent  survey carried out by the Residential Landlords Association, over 70% of landlords are unaware of their new responsibilities or do not understand them.
Do the new rules apply to you?
The rules cover landlords of residential properties, and also anyone who sub-lets their property or who takes in lodgers. They apply to any new tenancy or new agreement which starts on or after 1st  February 2016, including any informal or verbal agreement. You do not (currently) have to make the checks where an existing tenancy is renewed, unless new tenants are added or there are changes to the property.
There are some exceptions, for instance, you do not have to make the checks if the property is a tied property, or a holiday let, but the majority of landlords letting Residential Properties will have to comply with the new rules. If you are uncertain, check the government’s guidance. 
What do you have to do?
The new obligations are known as ‘right to rent checks’ and require landlords to check that their tenant or prospective tenant is entitled to live in the UK.  You should make the checks by ensuring that you see, and take copies of, your tenant’s documents so that you can show that you carried out the check. 
You need to carry out checks on everyone who is over 18 and who will be living in the property, not just the person who is named on the tenancy agreement. For this reason, it may be sensible for you to include in your tenancy agreements the names of all people who will be living  in the property, and the clause to state  that no-one else is allowed to move into the property without your permission (not to be unreasonable withheld). You may wish to ask for proof of the age of any teenagers to ensure that they are under 18.
You can make the checks up to 28 due before the tenancy is due to start. The government has issued guidance (available online here)  which explains what documents can be accepted, and how you can check that the documents you are shown are genuine
It is very important that you keep accurate records so that if enquiries are made, you can show not only that you made the appropriate checks, but also what documents you saw and when the check was made. You should keep your records for at least one year after the tenancy ends.
In some cases, a tenant may have a right to be in the country for a limited period (for instance, they may have a visa with an expiry date). In that case, you must make a note of when the right to remain ends and repeat the check when it expires, or after 12 months, whichever is sooner. If the tenant is not then able to provide new evidence that they are entitled to remain then you may have an obligation to inform the Home Office.
Please note, as a landlord, your responsibility it to make the checks and keep adequate records showing you have done so, you have to show that you have followed the new rules. It is not your responsibility to act as an immigration officer.
What if my tenant does not have the right to rent?
If it turns out that your tenant or lodger did not to have the right to rent in the UK, due to their immigration status, you (and your agents) could be liable for fines of up to £1,000 per tenant for a first offence, and up to £3,000 per tenant for any further incidents. You will not be liable for a fine if you can show that you made the appropriate checks and that the tenant, when you rented to them, had or appeared to have the right to rent.
It is therefore very important that you make the checks before agreeing to let your property, and that you keep records of the check made and copies of the documents provided. 
Do I have to make checks on British Tenants?
The government has introduced the rules to combat illegal immigration, and you only risk a fine if you are found to have rented to someone who is not entitled to rent in this country and you have failed to carry out the proper checks. 
However, if you only carry out checks on people who are not, or appear, not to be British / EU / Swiss citizens (who are entitled to rent here)  you may lay yourself open to accusations of racism or discrimination, as well as risking failing to make checks where they are needed. 
Do I need to make any changes to my Tenancy Agreements?
You may want to make some changes to new tenancy agreements, for example, to include details of the names of all occupants, to make clear that the tenancy is conditional on the occupants passing the right to rent checks.
If you need advice about a residential Tenancy, contact Simon Twose of our residential Property Department


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