Tenant Fees Act landlord: what you can and cannot charge

In England, the Tenant Fees Act 2019 limits what a landlord or letting agent can charge in connection with a tenancy. You can only request specific payments listed in government guidance, such as rent, capped deposits, certain default fees, and limited charges when the tenant requests changes. Anything else is a prohibited payment.

Does the Tenant Fees Act apply to my tenancy in England?

This government guide is for landlords and letting agents, and it explains what fees you can ask for when renting out a property in England under the Tenant Fees Act 2019.

The guidance says the act applies in England only, and it applies to certain types of tenancy and licence arrangements.

• It applies to assured periodic tenancies.
• It applies to student accommodation.
• It applies to licenses to occupy housing, for example, a lodger living in your home.

The guidance also lists situations where the act does not apply. For example, it does not apply to properties with an annual rent of more than £100,000, and it does not apply to social housing assured tenancies, shared ownership leases, short term holiday lets, excluded licenses.

It also says the act applies to housing associations and local authorities when they are letting a property privately.

What payments can a landlord or letting agent charge under the Tenant Fees Act?

The key rule is simple. You can only charge payments that are on the permitted list. The guidance is explicit: You cannot charge your tenant any payment that is not on this list.

The permitted payments listed in the guidance are:

• the rent if you and the tenant have signed the tenancy agreement
• a refundable tenancy deposit
• a refundable holding deposit to reserve a property
• a payment to change the tenancy when requested by the tenant
• a payment when the tenant does not give the correct amount of notice
• a payment towards utility bills, communication services and council tax
• a fee for late payment of rent
• a fee for replacing a key or security device

When you are deciding whether something is allowed, start by matching it to one of these categories. If it does not fit, you should treat it as not chargeable.

The guidance also says: You should contact landlord advice services if you are not sure if the fee you are charging is allowed.

What are the rules on rent and rent in advance?

The guidance includes some clear points about how rent should be structured, and when you can ask for it.

• Rent should be fair and in line with other similar properties in the area.
• Rent should be required at regular intervals and should be equally split across the tenancy.

There is also a specific restriction from a set date. The guidance says: From 1 May 2026, you cannot ask for a tenant to pay rent before the tenancy agreement is signed. It adds: If a tenant offers you rent before the tenancy agreement is signed, you must not accept it.

Once you and your tenant have signed the tenancy agreement, the guidance allows limited rent in advance. It says: You can ask for a maximum of 1 month’s rent in advance after you and your tenant have signed the tenancy agreement and before the tenancy start date.

How much can you take as a tenancy deposit?

A tenancy deposit is allowed, but it is capped. The guidance sets different caps depending on the annual rent level.

• You can require a tenancy deposit of up to 5 weeks’ rent for properties where the annual rent is below £50,000.
• For tenancies with an annual rent of between £50,000 and £100,000 you can require up to 6 weeks’ rent.

The guidance also makes two practical points that are easy to miss:

• You do not have to take a tenancy deposit.
• If you do take a deposit, you must protect it in a government approved scheme .

How does a holding deposit work, and when must it be refunded?

A holding deposit is a refundable payment to reserve the property while you carry out reference and pre tenancy checks. The guidance is clear on both the maximum amount and the key timing rules.

How much can you charge as a holding deposit?

• The maximum holding deposit you can ask for is equivalent to 1 week’s rent.
• You cannot accept more than one holding deposit per tenancy at a time.

The guidance also explains that the cap is per tenancy, not per person. For example, if three potential tenants are sharing under one tenancy agreement, they pay a total of 1 week’s rent between them.

How long can you hold it?

The guidance sets a standard period: The standard amount of time you can hold the deposit for is 15 calendar days after receiving it. It also allows flexibility if you agree it: You can agree a longer or shorter time period with the tenant in writing.

When do you have to refund it?

The guidance says you must refund the holding deposit unless the tenant:

• fails a Right to Rent check
• withdraws from the application process
• does not respond or contact you to progress the tenancy
• gives you false or misleading information that affects their suitability as a tenant

It also gives an example where you still must refund. If the tenant has given incorrect information that does not affect their suitability, for example, a misspelling or a missing previous address, then you must return the holding deposit.

If the tenant signs the tenancy agreement, you must refund the holding deposit. The guidance explains you could refund it by reducing the amount of the first month’s rent or reducing the tenancy deposit, but it says this can only be done with the tenant’s agreement.

For other circumstances where you must refund, the guidance states: For all other circumstances, you must return the deposit within 7 days. It warns that if you do not return it, you may receive a financial penalty.

If you decide to keep the holding deposit, there is also a timing rule about explaining why. The guidance says: If you do not tell the tenant the reason for your decision in writing within 7 days you may receive a financial penalty.

What can you charge for bills, council tax, and a television licence?

The Tenant Fees Act allows certain payments towards utilities and other charges, but the way you collect them matters.

Utilities and communication services

The guidance says you can include utilities and communication services in the rent, or require the tenant to pay separately. It gives examples such as gas, electricity, water bills, broadband and a landline phone.

If bills are included, the guidance says these must be listed as terms in the tenancy agreement, and that any utilities included in the rent must be an accurate reflection of costs.

It also says you cannot make a profit from reselling utilities, and it cites legislation and regulators in support of that point.

Council tax

• You can include a payment for council tax within the rent where this is agreed in the tenancy agreement.
• If payments for council tax are not included in the rent, you can include a term in the tenancy agreement requiring the tenant to pay council tax to the relevant local authority.
• You cannot require a tenant to pay a separate, additional payment for council tax to you directly.

Television licence

• You can include a payment for a television licence within the rent where this agreed in the tenancy agreement.
• If payments for a television licence are not included in the rent, you can include a term in the tenancy agreement requiring the tenant to pay for a television licence .
• You cannot require a tenant to pay a separate, additional payment for a television licence to you directly.

What are “default fees”, and what limits apply?

The guidance allows default fees, but only in specific situations and only if you have dealt with them properly in the tenancy agreement.

First, the guidance says you can charge the tenant a default fee if this is included in the tenancy agreement, and that you should make the tenant aware of these fees before they sign the tenancy agreement.

It then limits default fees to two categories:

• for the loss of a key or other security device giving access to the property
• for late payment of rent

Replacement keys, security devices or fobs

The guidance says the tenant is responsible for looking after the keys for the property throughout the tenancy.

It also says you can charge the tenant the cost of replacing a key or other security device, but you must provide evidence in writing to the tenant to show the costs you have incurred are reasonable.

Late payment of rent

The guidance sets both a minimum lateness threshold and a maximum rate.

• Rent must be overdue by at least 2 weeks before you can charge a fee.
• The maximum fee rate is 3 per cent above the Bank of England’s base rate .
• You can only charge a fee on the amount that is overdue.

The guidance also explains that if the overdue amount changes, for example on the rent due date or when the tenant makes a payment, you should recalculate the new sum.

It encourages you to apply default fees case by case. It gives examples where it may not be appropriate, such as where a tenant has provided a reasonable explanation and sufficient notice, and especially if they normally pay on time or the delay is outside their control (with examples like banking systems are down, or delayed Housing Benefit or Universal Credit payments).

What is a prohibited payment, and what happens if you charge one?

The guidance defines a prohibited payment as a fee that is not allowed. It says: If you require your tenant a fee that is not allowed this is called a prohibited payment.

It also explains other things that count as prohibited. It says it is also a prohibited payment if you require your tenant to take out a loan, pay for insurance or start a contract for a service. A tenant can use a loan, insurance or contract if they choose to, and it gives examples including a professional guarantor service, a deposit replacement product, and an inventory service.

The guidance says the local council can investigate you or your letting agent if you are reported for requiring a prohibited payment. If the council finds that you have required a prohibited payment they may issue a financial penalty.

• For the first occasion the maximum penalty is up to £5,000.
• If you have committed a second or subsequent breach within 5 years of a previous penalty, you can be taken to court or issued with a penalty of up to £30,000.

If you are prosecuted, the guidance says the fine you would have to pay would be an unlimited amount. It also says a prosecution is a banning order offence which would stop you from letting out or managing property, and that if you have been given a banning order you will be added to the rogue landlord database.

The guidance adds that your tenant can also apply to the First tier Tribunal who can order you to return the fee.

If you get a financial penalty or have to repay a prohibited payment, the guidance says you can appeal through the First tier Tribunal. It gives a deadline for an appeal of 28 days from the day after the final notice for the penalty was given to you or 7 to 14 days after you have to pay the prohibited payment.

Keeping on top of what you have asked for, what you have agreed in the tenancy, and what you have returned helps you stay consistent across tenancies.