Owning and renting a property can bring a great return, but it comes with responsibilities. But these needn’t be onerous. After all, by sticking to your responsibilities you’ll keep your tenants happy and keep your investment safe.
Most of your landlord responsibilities are likely to be listed in the tenancy agreement you draw up, which will outline the terms you both agree to, but there are those that need to be included by law. Use our checklist of landlord obligations below to be sure you don’t get caught out:
As a landlord, you’re required to make sure your property is ‘fit for purpose’ meaning it will need to be:
• Structurally sound
• In good repair
• Free from damp
• Insulated and energy efficient
And it will need to have:
• A source of natural light
• Adequate ventilation
• Water, heating and electricity.
• Facilities for personal hygiene, drainage and sanitation
• Facilities for food preparation, cooking and water waste disposal.
Any issues with the roof, walls, chimney or guttering need to be dealt with if reported, as do those related to the supply of water, gas or electricity – pipes, taps, fixtures and fittings, and any bathroom or kitchen appliances included in the tenancy.
If you haven’t provided repairs, or refuse to provide them, your tenant can step in to challenge this. If the repairs are under £1,000 they can take you to small claims or otherwise do the work themselves and subtract it from the rent. They can also request an inspection from the local council, who will take action if they find any serious hazards.
Sometimes it might be the tenant that has caused the damage. Take photos of the property before the tenancy begins, so you can prove whom the responsibility lies with in the event of a dispute. It may be that you want to deduct the costs of the repair from the tenant’s deposit, or claim the amount through your landlord’s insurance, if you have it.
When you rent out your property, you’re responsible for its condition and the safety of your tenants. Make sure you provide the following:
Fire safe furniture and furnishings
It’s essential that your property complies with The Furniture and Furnishings (Fire Safety) Regulations 1988. Basically, this means that materials, such as upholstery and furniture filling materials, have to meet a certain standard of fire resistance. Generally, this information is available on accompanying labels or from the manufacturers. To find out more, the Fire Safety Advice Centre has further details.
Smoke and carbon monoxide alarms
By law, you must have at least one smoke alarm on each floor of your property. Rooms that burn solid fuel must also have a carbon monoxide alarm. It’s also your responsibility to check that these alarms are working before the start of every new tenancy agreement.
Gas Safety Certificate
You’ll need a Gas Safety Certificate which will be issued by a Gas Safe engineer, who will look at gas appliances as well as piping and flues. Once your certificate is issued, you’ll need to give a copy to your tenants. For more comprehensive information, check out our very own Guide to gas safety certificates.
Electrical Safety Certificate
Before your tenants move in, you’ll need to make sure that sockets, lights and fittings are safe. Appliances, such as washing machines, will also need a CE marking at minimum. If your property is a House in Multiple Occupation (HMO) you’ll need an inspection and test every five years. A certified electrician can issue you with an Electrical Safety Certificate after inspecting. It’s not currently a legal requirement but will reassure both you and your tenants that the appliances in the property are in working order and safe to use. Read our guide on the electrical safety certificate for more information.
Portable appliance tests
Landlords should also have electrical appliances inspected by an electrician. If satisfactory, each appliance will get a PAT (portable appliance test) sticker. It’s a good idea to get this done, because otherwise tenants or local councils can demand it. In the worst-case scenario, this may stop your property from being used – so it’s worth getting it done.
A safe water supply
By law, landlords are required to assess the safety of water in the property to help control the risk of exposure to legionella, which develops in stagnant water. Simple measures can be taken such as flushing out the system prior to letting the property and making sure any redundant pipework is removed – which a plumber will be able to take care of. Tenants should be told to report any problems with the water supply to their landlords. A full guide to controlling legionella bacteria in water supplies can be downloaded from the Health and Safety Executive.
While it may be your property, your tenants are entitled to respect and privacy.
Rent increases are permissible depending on the type of tenancy mentioned in the tenancy agreement. Rent increases should be reasonable, because otherwise your tenant could take you to the First Tier Property Tribunal, who can decide the amount.
For fixed-term tenancy rent increases, rent rises are permissible at any point, as long as it states this in the tenancy agreement. Otherwise, you’ll have to wait until the agreement runs its term.
With periodic tenancy – if it’s renewed weekly or monthly – rent price can only be raised on an annual basis. This can be done through a mutually agreed contract or a form available from Gov.uk. The form must be submitted with at least one month’s notice though.
Right to enter
You’re legally allowed to enter the premises for inspections and repairs, but will need to give at least 24 hours’ notice, unless it’s an emergency. Tenants have the right to remain in the property when repairs are carried out.
In order to evict your tenant there is a strict process which must be followed.
For assured shorthold tenants:
For Assured and regulated tenancies:
For Excluded tenancies
Tenancy right to rent
Always check your prospective tenant has the right to rent property in the UK, as part of the Immigration Act. Request copies of original ID – and a visa if they require one – so you can check their status. For more, check out our Guide to tenant referencing.
Without the right to rent, you’re required to take steps towards evicting them. This can either be through a mutual agreement or, if your tenant is unwilling to leave, you can request intervention from the High Court bailiffs. You must still give your tenants 28 days’ notice before taking this step.
Being a landlord can be a profitable venture, but this means that it comes with tax responsibilities.
While you don’t need to pay tax on the first £1,000 of your annual income from property rental, thereafter you’ll need to report income on a self-assessment tax return. Deductible expenses include things like legal fees, service charges, utility bills etc. Gov.uk have a full tax guide for property rentals.
You’ll need to pay Class 2 National Insurance if you meet the following criteria:
Protect the tenant’s deposit
It’s now a legal requirement to place the tenant’s deposit into a UK government-approved deposit protection scheme. Any landlord failing to do this risks fines, and it could also create problems when trying to end the tenancy.
There are three different deposit schemes: the Deposit Protection Service (DPS), the Tenancy Deposit Scheme (TDS) and mydeposits. Although each plan has its application, the overall idea is to prevent landlords unfairly withholding deposits at the end of a tenancy in the event of a dispute.
While being a landlord can reap you great rewards, being responsible for maintaining the property and providing multiple services for the tenants can be expensive if things don’t go to plan.
MORE THAN landlord insurance can cover you in the event of damages to your property, loss of rent and home emergencies, which aren’t covered in standard packages.