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By James Garvey

Head of Client Management, The DPS


Two years on - how can agents comply with the Tenant Fees Act?

It’s nearly two years since The Tenant Fees Act came into force for tenancies in England. On 1 June 2019 it became illegal for landlords and letting agents to charge certain fees in connection with a tenancy, and caps were placed on the amount that could be taken for holding and security deposits.

- Fees which can be charged during the tenancy are limited to:

- reasonable costs incurred in replacing a key or lost security device,


- payments associated with early termination of the tenancy, when requested by the tenant,

- fees for the variation, assignment or novation of a tenancy. These are capped at £50 (or reasonably incurred costs, if higher),

- payments for utilities, communication services, TV licence and Council Tax,

- default fees or interest on rent overdue by 14 days or more. This interest is capped at 3% above the Bank of England base rate.

Regarding deposits:

- refundable holding deposits to reserve a property are capped at one week’s rent,

- tenancy security deposits are capped at the equivalent of 5-weeks' rent for assured-shorthold tenancies with an annual rent of up to £50,000, or 6-weeks' rent for tenancies with an annual rent of £50,000 or more;

The changes came into force for all new tenancies entered into from 1 June 2019, and any existing tenancies renewing on a fixed-term basis after this date.

The regulations have now been in place for two years, but during that period there have been cases of deposits being submitted that appear to exceed the cap.

It of course remains in everyone’s interests for these deposits to be protected, and as a Government-approved scheme we’re obliged to accept them. However, we encourage all agents and landlords to make sure they apply the cap accurately so that the deposits comply with the Act.

It’s essential that you check that any security deposit you take for a tenancy is within the legally allowed limits. Bear in mind there are no special provisions or exemptions if the tenant has a pet. The maximum deposit amount allowed must still fall within the compliance thresholds.

Check how much deposit you can take in three simple steps with our easy-to-use deposit calculator

Step 1: Download our Deposit Cap Calculator

Step 2: Enter the rental payment amount

Step 3: Enter the rental period – monthly or weekly

The calculator will work out whether you can take a deposit equal to five or six weeks’ rent, and what the maximum amount is you can hold.

*James Garvey is Head of Client Management at The DPS


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