Legal Consideration

Tenancy Agreements

If you are managing the property, you should read the tenancy agreement and adhere to its terms. Tenants have an obligation to look after the property and landlords must allow quiet enjoyment of the property but they must also ensure that the property is kept in good repair and that the services to the property are maintained in a safe condition (electrical installations, plumbing and heating, roofs and structure). Any visits to the property should follow 24 hours notice to the tenant.

Inventory and Schedule of Condition

We are one of the few agents who use an independent inventory company to carry out a fresh inventory and schedule of condition with every new tenancy. This is very important, as the inventory forms one of the most important items in a dispute.

Landlord Responsibilities:

Consent to let

All owners must appear on the agency Terms of Business and on the Tenancy Agreement. Where the property is leasehold, you should gain a consent from the managing agents. If the property has a mortgage, you should also get consent to let from the lender.

Insurance offering the appropriate cover

Tenants are advised to have contents and accidental damage insurance but cannot be forced to do so. So, again, it is very important that the landlord takes out appropriate insurance. We can help provide appropriate insurance.

Proof of Identification

The Money Laundering Act requires us to obtain proof of identification from all owners. We will need to see the documents, or certified copies from either your solicitor, accountant or doctor, for our records. This comprises either a current passport or photo driving licence and also proof of residency, which could be a utility bill, council tax bill but within the last three months.

Income Tax

From 6th April 1996 the rules regarding Non-Resident Landlords (NRL’s) changed. The NRL Scheme taxes the UK rental income of persons who live outside the UK.

Kevin Henry must deduct tax from the rental income after certain allowable expenses and pay the tax to HMRC and account for it on a quarterly basis.

Where there is no letting agent, tenants who pay more than £100 per week must also deduct tax and pay to HMRC. Those paying less than £100 per week do not have to pay tan unless advised by HMRC.

The withholding and payment of tax to HMRC could be avoided by a non-resident landlord, if he or she:

  • Commits to comply fully with the requirements of self-assessment
  • Has a good tax history -
    Returns submitted on time
    Tax payments made on time
  • Has no tax liability
  • Is regarded as ‘resident’ in the United Kingdom

An application for Gross Payment of Property Income must be made by the owner(s) of the property. Joint or multiple owners must both / all apply as individuals. This will be the NRL 1 form, or, for companies, the NRL 2 form. If approved by the scheme, each residential landlord will be issued an approval number and, once received by Kevin Henry, rents will be paid without the deduction of tax.

HMRC can withdraw approval if they are not satisfied that the NRL is complying with their tax obligations or fails to supply information required and, in this instance, will be withheld to pay to HMRC.

For further information, please refer to your tax advisor or accountant, or contact the HMRC CNR Helpline on 01514 726208, or visit www.hmrc.gov.uk

Gas Safety (Installation & Use) Regulations 1994 & 1996

All gas appliances, including central heating systems, cookers, heaters, fires, flues and pipe work (etc) must be serviced and safety checked on an annual basis and maintained by a Gas Safety Engineer. A copy of the gas safety certificate must be given to the tenant along with details of any remedial work required / carried out. Copies of all certificates must be retained for a minimum of two years.

Failure to comply is a criminal offence.

Changes to industry guidance relating to an existing gas central heating system where the flue system is concealed in a void and cannot be visually inspected (to make sure it is safe) will require provision of an inspection hatch(es) before 31st December 2012.

For further information: http//www.hse.gov.uk

Electrical Safety in Dwellings

Electrical Safety Regulations 1998. Any electrical equipment or appliance (including immersion heaters and cooker as well as kettles etc.) supplied must be safe and, to establish this, should be tested by a qualified electrician. Each item should be labelled and records supplied. Any risk that occurs through the supply of unsafe equipment incurs a penalty of £5,000 or a minimum of three months’ imprisonment.

Part P regulations require all wiring and electrical works be designed, installed, inspected and tested in accordance with the requirements of BS77671 and carried out by a ‘competent’ person – this means someone qualified, i.e. NECEIC registered.

A responsible landlord should get all wiring checked and receive appropriate certification.

For further information, please visit the Electrical Safety Council website at www.esc.org.uk

Smoke Detectors and Carbon Monoxide Detectors

New legislation came into force on the 1st October 2015 for Private Landlords in England regarding smoke and Carbon Monoxide (CO) alarms.: Landlords must fit a smoke alarm on every storey. Landlords must fit a Carbon Monoxide (CO) alarm in every room with a solid fuel burning appliance. Alarms must be tested and working on the start of each tenancy. Penalties of up to £5,000 for those that flaunt the rule. It is outlined that the relevant Local Authority will enforce.. The regulations do not stipulate the type of alarm to be installed. However, the Q & A booklet states: Landlords should make an informed decision and choose the best alarms for their properties and tenant. For further information, www.direct.gov.uk

Furnished Properties

Any furniture in a rented property (fully or part-furnished) must comply with the Furniture and Furnishing (Fire) (Safety) (Amendments) Regulations 1993. These regulations aim to improve safety by requiring all furniture and furnishings in rented properties to pass certain tests, including the ignitability test, the match test and the cigarette test. The regulations apply to all upholstered furniture and loose fittings, permanent and loose covers, including beds, headboards, mattresses, pillows, sofas, chairs, scatter cushions and bean bags. Each item should have a permanent label showing that it is fire resistant. If not, it should be removed from the property. Carpets and curtains are not covered by the regulations. Furniture manufactured before 1950 is exempt.

Failure to comply could lead to a £5,000 fine and / or six months imprisonment.

For more information, please refer to www.bis.gov.uk

Energy Performance Certificates

All landlords letting a property from 1st October 2008 are required to have an Energy Performance Certificate (EPC) unless the property is listed. An EPC will be valid for ten years and must be conducted by an accredited Domestic Energy Assessor

The Approved Code of Practice for the Control of Legionella Bacteria in Water Systems (L8)

Landlords are required to undertake a formal Risk Assessment for water systems within the premise to be let.

For further information, please go to:
http://www.hse.gov.uk/pubns/priced/hsg274part2.pdf