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Non Resident Landlords and Taxes Management Act

You are responsible for notifying the Inland Revenue of the tenancy and for your own tax liability if you reside within the UK. If you reside abroad for 6 or more months of a tenancy, the Inland Revenue will hold us, as your managing agent (or your tenant where the tenant pays the rent directly to you), responsible for the payment of any tax liability which arises on rents collected by us on your behalf, unless an Approval Certificate is provided by the Inland Revenue pursuant to The Finance Act 1995. You can apply for the Inland Revenue exemption by filling out an NRL1 form quoting Northfield’s reference number: NA 010715. More information is available at www.hmrc.gov.uk/international/nr-landlords t. 0300 200 3300/+44 135 535 9022

If the Inland Revenue does not provide Northfields Estates or your tenant (for let-only tenancies) with a valid approval certificate, it will be necessary for the tax to be deducted at source at the appropriate rate (currently 20%). This money will be forwarded on a quarterly basis to the Inland Revenue and you are advised that the money will not earn interest on your behalf. The eventual liability for tax may be less than the amount forwarded to the Inland Revenue and, in this event, you will have to liaise with the Inspector of Taxes directly for any reimbursement, and Northfields will not be liable for any refunds to you. Should you at present reside within the UK but subsequently move abroad, please let us know the name of your accountants or tax advisors at that time.

In the event that you are not accepted for the Non-Resident Landlord Scheme, we shall make an administration charge of £42 inc VAT (£35 plus VAT) per quarter for forwarding monies to the Inland Revenue.

HMO Licensing

Since 2006 there has been a requirement to have a Mandatory license for properties where the property is over three storeys, there are two or more households and there are five or more people living in the property. Local councils have also been allowed to require licenses under ‘additional’ and ‘selective’ schemes. From 1st October 2018, a Mandatory License is required where the property is occupied by 2 or more households and there are 5 or more people thus removing the ‘3 storey’s requirement. There are some exemptions. As a landlord, you need to ensure that you are familiar with the local licensing requirements and are compliant with them. Penalties for non-compliance can be an unlimited fine as well as not being able to serve notice to take back possession of the property. License requirements can be driven by the location of the property or the mix of the tenants so it is very important to consider these factors when looking to let. Your local branch or council can give you further specific guidance and assist with any application (additional charges apply.) Also see local links below :

https://www.ealing.gov.uk/info/201086/housing_and_council_tax/2201/private_rented_property_licensing

https://www.lbhf.gov.uk/housing/private-housing/property-licensing-landlords-and-letting-agents

Northfields are happy to oversee your HMO application on your behalf and can, where appropriate, stand as the ‘fit and proper person’ where we are instructed under our full management service. There is an additional cost for this service. Please ask your local branch for a leaflet.

Energy Performance Certificate (EPC)

The Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 mean that, from April 2018, private non-domestic (and domestic) landlords must ensure that properties they rent in England and Wales reach at least an EPC rating of E before granting a tenancy to new or existing tenants. A valid EPC, issued by a Domestic Energy Assessor, must be available to prospective viewers at the commencement of marketing and we shall ensure that a copy of the EPC is provided to the tenant prior to the commencement of the tenancy. Northfields are happy to arrange an EPC on your behalf at a cost of £120 incl VAT.

Take your Time

We know that there is a lot of information contained within this booklet but please understand our wish to ensure that you have all of the information that you need before you decide to rent out your property, and are legally compliant. We urge you to take the time to read the contents in full and ask us about anything you do not understand.

Consents and Checks

As a helpful reminder you should ensure that all items below are adhered to in full:
-Mortgage Consent
-Superior Landlord Consent
-Buildings Insurance that adequately covers your rental property
-Contents Insurance including public liability insurance
-Energy Performance Certification
-Safety Certification for:
-Gas appliances
-Electrics checked – fixed wiring (EICR)
-Electrics checked – portable appliances if applicable (PAT)
-Working smoke detectors on every floor
-Legionnaires risk assessment
-Furniture and furnishings safety compliance check
-Asbestos check
-CO (carbon monoxide) detectors fitted and working within 1.5m of any
-solid fuel appliance

The Rent

  • Unless otherwise agreed, the rent achieved by us on your behalf will be inclusive of all outgoings for which you are responsible ie. ground rent, service charges, buildings insurance etc. with the exception of gas, electricity, water, telephone line rental, council tax and where there is an independent heating system. If you pay water rates (or similar) as part of your service charge and wish to pass this charge onto your tenant please ensure you have notified Northfields of this and the relevant clauses are contained within the tenancy agreement.

Rent Remittances

  • The tenant is requested to pay the rent directly into the bank by standing order mandate. If the tenant does not wish to pay in this manner and adopts a different payment method, it is not possible to enforce the standing order payment method and court action can only be taken if the rent is in arrears as per the grounds listed in the tenancy agreement. Rent less agreed deductions will be transferred by BACs as soon as administratively possible. Any monies dispatched will be without prejudice to final clearance.
  • Please Note: By accepting rent by standing order, should the tenant breach the terms of their agreement, the continued payment of rent may be deemed by a court as a waiver by you of the tenant’s breach. Therefore, in the event that we do not manage your property, you must notify the tenant immediately following any breach that monies received by standing order are to be regarded as “mense profits”, basically money taken for the continued use and occupation of the premises and NOT RENT.

Type of Tenancy Agreement

  • Unless we are instructed otherwise, we will use our standard form of a tenancy agreement. Landlords instructing their own solicitors to prepare an agreement will be responsible for their solicitor fees, however, an additional administration charge of £200 inc VAT will remain due to Northfields at the outset of the Tenancy because, as your agent, we have a duty of care to fully understand and advise on the contract you wish to use.

Terminating the Tenancy

  • A) Termination of an Assured Shorthold Tenancy
    To regain possession of your property at the end of an Assured Shorthold Fixed Term Tenancy you MUST give the relevant notice to your tenants and have provided (with proof) all relevant prescribed information and other documents, as required by the Deregulation Act 2015, at the outset of the tenancy:
    – You MUST give at least 2 calendar months written notice. Northfields will be happy to issue the tenants with a Form 6A Section 21 Notice to this effect upon your instructions and where the tenancy agreement has been provided by Northfields. You shall be charged £240 (including VAT) for the serving of the notice.
    – This notice will not be issued automatically. Therefore, unless you request Northfields to serve notice on the tenants and if the tenant does NOT leave at the end of the fixed term; the tenancy will become a Statutory Periodic Tenancy.
    – At this point and at any time within a Statutory Periodic Tenancy, you will be required to serve 2 periods notice to regain possession of the property. Northfields will be happy to issue the tenants with a Form 6A Section 21 Notice to this effect upon your instructions and where the tenancy agreement has been provided by Northfields.
    – In the event of the landlord wishing Northfields to serve notice on the tenant, you must give us a minimum of 1 weeks notice, in addition to the notice period required for the Tenant.
    Please Note: The tenant can vacate at the end of a Fixed Term tenancy without giving notice to the landlord, however, within a Statutory Periodic Tenancy, the tenant must give one period notice to end the tenancy. One period is calculated in accordance with the rental payments.
  • B) Termination of a Non-Housing Act Tenancy
    A company tenancy, a high rent tenancy (over £100,000 pa pure rent), a tenancy with a resident landlord or a pied-a-terre tenancy will end according to the dates contained within the initial fixed term of the agreement, called the “effluxion of time” and although formal notice is not required, both parties have a duty of care to give reasonable notice to the other party. Generally, one month’s notice will suffice or notice can be given in accordance with any break clause contained within the tenancy. If the tenant remains in the property and no replacement tenancy is put in force so that the original tenancy becomes a periodic or rolling tenancy, the landlord must serve a Notice to Quit giving at least one period’s notice to end the periodic tenancy.

Using a break clause

  • If you have negotiated a break clause in the tenancy agreement and the tenant exercises their right to this clause Northfields will refund any upfront lettings service commission paid or due for the unexpired period providing all three criteria listed below have been met:
    1. At least 6 months of the tenancy has lapsed
    2. We are given 6 weeks exclusivity to re-market the property
    3. We are unable to introduce a suitable tenant within the 6 week period of re-marketing
  • In the event that we are not given the opportunity to re-market the premises, no refund will be given. If we are able to secure a new tenancy covering the remaining period, our commission for the second letting will apply as normal, and we will credit your account for the period of overlap with the original fee. You will therefore not pay twice for the same period. Should you agree to release the tenants from their tenancy agreement before any break clause expires, no refund of fees shall be due before the period where the break clause would have allowed the tenancy to be terminated and fees will remain due where not yet paid to the earliest break clause expiry date.

Landlord and Tenant Act 1987 Section 47

  • We are obliged to include your full name and address on all rent demands (tenancy agreements). If your address is outside England and Wales, then we must provide the tenant with an address within England and Wales to which notices (including notices in proceedings), may be served on you. Unless otherwise instructed, if your address is outside England and Wales and we manage your property, we will use the address of our management department during such period as we manage the property. We will use our best endeavours to forward any notices to you promptly but we cannot accept liability for any loss or damage incurred either directly or indirectly from our actions in this respect.

Landlord and Tenant Act 1985 Sections 1 and 2

  • If the tenant makes a written request for your actual address, wherever in the world you may be, it is a criminal offence to withhold the information and it must be provided within 21 days of receipt of the request, otherwise, you may be liable upon conviction to a maximum fine of £2,500. If you, as the landlord, are a limited company or body corporate, upon written request by the tenant, you are obliged to provide the name and address of every director and the company secretary within 21 days, or you could face a further fine of up to £2,500.

Inventory Services

  • The inventory clerk will not move or lift heavy items. The inventory clerk is also not required to test any gas or electrical appliances. If a clerk feels at any point that their personal health or personal safety is in question then they will abandon any work being undertaken and return to the property at a later date once the issues have been addressed. Should this result in additional charges made by the inventory clerk these shall be borne by you.

Housing Benefit Payments (if applicable)

  • Where the tenant is in receipt of Housing Benefit payments, you indemnify Northfields against any requirement to refund Housing Benefit to the council.

Water Rates and Water Meter Charges

  • Further to the Flood and Water Management Act 2010, which came into force on 1st October 2011, you will remain liable for any outstanding water charges if the tenant vacates the property and DOES NOT provide a UK forwarding address or does not settle the account in full at the end of the tenancy. If Northfields are not acting as your management agent, you are advised to request proof of payment in the form of a receipted final bill or retain money from the deposit for the purpose of settling any final accounts. Northfields are not accountable or responsible for checking water meters or finalising water bills on behalf of tenants, whichever service we provide for letting or managing the property.

Nearly there

If you have any questions feel free to contact a member of staff:

Ealing Broadway: 20 New Broadway Ealing W5 2XA t: 020 8566 5500
Northfield Avenue: 130 Northfield Ave Ealing W13 9RT t: 020 8567 6660
Pitshanger Lane: 1 Albert Terrace Ealing W5 1RL t: 020 8998 3111
Shepherds Bush: 127 Askew Road Shepherds Bush W12 9AU t: 020 8740 8833

e: [email protected]

Head Office and Accounts: 130 Northfield Avenue Ealing W13 9RT t: 020 8799 4367

e: [email protected]

Courts and Tribunals

  • Applications for fair rent or appearances before the Rent Officer, Rent Assessment Committee or any other court or tribunal is by special arrangement only and will be subject to an additional charge of £72 inc VAT (£60 plus VAT), per hour or part thereof, per person in attendance, plus expenses. The administration cost for Northfields to organise paperwork for solicitors or arbitration is £72 inc VAT (£60 plus VAT) in addition to the legal costs.

Instructions of Solicitors

  • You will be informed of any rent arrears or breaches of covenant brought to our attention. However, if legal action is required you will be responsible for instructing your own solicitors and for all fees involved.

Renewals to the same tenant

  • We recognise that the point of renewal offers us a fantastic opportunity to review all aspects of the tenancy. Not only is it the perfect time to increase the rent (subject to market conditions) but also to discuss any necessary enhancement or refurbishment of the property in order to maintain it and to maximise the rental yield.
  • Your renewal will be diarised and monitored so that you are contacted in accordance with the terms of the tenancy agreement to discuss your requirements. Even if we have not been asked by you to renegotiate with an existing tenant, we will continue to hold the deposit as a stakeholder or extend any deposit replacement product and our staff are available to advise on the renewal of the tenancy agreement.
  • Fees are due to Northfields at the agreed rate for any extending period (including fixed-term tenancies, periodic or rolling tenancies or any other type of tenancy) whilst the tenant, or occupant introduced to you by Northfields, remains in the premises.
  • Our fee is due at the agreed percentage of the rent for the term of the extension or continuation whether or not we are party to or undertake any negotiation on your behalf. Fees will be taken monthly in line with the rent where rent is processed by Northfields or due upfront and calculated at the agreed percentage of the rent for the continuation term agreed should other rent processing provision be made.

Right to Rent in the UK – Documentation and Working Visa

  • As from 1st February 2016, under the Immigration Act 2014, it is the landlord’s responsibility to ensure that all tenants have the right to rent in the UK by making and keeping a copy of passports or acceptable ID cards for all tenants and evidence of their immigration status (biometric residence permit). Northfields will undertake tenant checks to the best of our ability but we cannot accept liability for any subsequent issues which arise either directly or indirectly from our actions in this respect. Please note that the penalty for non-compliance is up to £3,000 per Tenant.

The Deregulation Act 2015

  • From 1st October 2015 a number of important changes came into effect for all new Assured Shorthold Tenancies in England that started on or after 1 October 2015:
    There are new restrictions on serving Section 21 Notices early and a new template Section 21 form to use (Form 6A). The Section 21 Notice cannot be served until 4 months of the tenancy has passed. The new rules also remove the need for a landlord to specify that a tenancy must end on the last day of a rental period; unless the tenancy started on a periodic basis without any initial fixed term where a longer notice period may be required depending on how often the tenant is required to pay rent (for example, if the tenant pays rent quarterly, they must be given at least three months’ notice, or, if they have a periodic tenancy which is half-yearly or annual, they must be given at least 6 months’ notice (which is the maximum.))
    Please note: In the event that a tenant has paid an amount of rent in advance and a Section 21 the notice requires them to leave during the period paid for, the tenant is entitled to a refund of the rent paid for the days they are not occupying the property.
  • Landlords will not be able to serve a Section 21 Notice on tenancies that began on or after 1st October 2015 unless they have provided tenants with the following information:
    – A Gas Safety Certificate covering all fixed and portable gas appliances provided by the landlord for the tenants’ use.
    – The property’s Energy Performance Certificates (EPC); (except where a property is not required to have an EPC – such as where the landlord is letting a room on a single AST in a House in Multiple Occupation (HMO).)
    – The Department for Communities and Local Government “How to Rent – the checklist for renting in England”. This can be provided in electronic format, or if the tenant requests it, or does not have access to IT facilities, should be supplied in paper copy. Agents and Landlords should supply the document itself as it is unlikely a link to where the document can be found on the internet will be sufficient. This should be given at the start of a new tenancy and the commencement of fixed-term renewals.
  • The Act also restricts a Landlord’s ability to serve a Section 21 Notice to recover possession of their property if:
    – The tenant has made a written complaint to the landlord or agent about the condition of their property or any common parts of the property (hallways, stairs, and gardens) which tenants have the right to use.
    – The landlord or their agent has not provided an adequate written response within 14 days
    – If no adequate written response is received the tenant can complain to the relevant local authority who could decide to serve a Relevant Notice in respect of the property or could carry out emergency remedial action themselves using their powers under HHSRS – the Housing Health and Safety Rating System.
  • Any failure to deal with complaints and repairs could become a serious and very expensive issue because a poorly maintained property means landlords may not be able to regain possession of their rental property for 6 months (i.e. from the date on which a local authority serves an improvement notice).

Rent and Legal Insurance Products

  • Every care will be taken to ensure that prospective tenants are fully referenced and you shall be asked to review the reference reports before we proceed to issue tenancy agreements for signing. By signing the tenancy agreement you are confirming that you are happy to proceed based on the references received. For your peace of mind, Van Mildert is able to provide insurance for legal expenses and/or rental payments. We believe that it is best practice to have insurance in place in case the tenant becomes unable to pay. Without insurance, you may be required to pay for solicitors to assist you in regaining possession of your property and you may wish to consider whether you would be able to make any mortgage repayments should a tenant cease making rental payments. You can choose to buy insurance from any provider that you wish and you are not obliged to take insurance.
  • We can offer an ‘Interest In’ our Rent Guarantee and Legal Expenses Insurance Policy as part of our service. You wouldn’t have any rights under the policy, but if your tenant does fall into arrears and we make a successful claim under the policy, any sums recovered that are due will be passed to you. Van Mildert will write to you directly to confirm your interest in this once a policy has been arranged if you opt for this service. Please see below further details about what the Rent Guarantee and Legal Expenses Insurance Policy includes:
    – The policy has an excess equivalent to two months of rent, i.e. the first and second months’ rent is not covered.
    – The policy will cover 85% of the rent for a maximum of six months, or until vacant possession, whichever occurs first – e.g. from the third month of missed rent, up to and including, the eighth month.
    – 50% of the rent paid for up to 3 months after vacant possession has been obtained, whilst new tenants are found, where there has been a claim for damage if the property cannot be re-let.
    – The policy will cover all aspects of the eviction up to a maximum of £50,000.

Please ask for further details and up to date prices.

Energy Supplier

  • The Landlord hereby authorises the Letting Agent, as its agent, to appoint OVO Gas Ltd and OVO Electricity Ltd (together “OVO Energy”) as the electricity and/or gas supplier for the property; however, this will not prevent the Landlord from changing to a different energy provider if desired.
  • The Landlord agrees that the Letting Agent may pass the Landlord’s name and contact details to OVO Energy for the purposes of:
    – (a) registering the electricity and/or gas meters at the property with OVO Energy, providing electricity and gas to the property and administering the Landlord’s account.
    – (b) registering the Landlord with the relevant local authority for the payment of council tax, and registering the Landlord with the incumbent water supplier to the property. The water supplier may contact the Landlord in order to provide further information about its services and products and conclude an agreement with the Landlord for those services and products.

The Homes (Fitness for Human habitation) Act 2018

  • This legislation came into force on 20 March 2019 and gives a tenant a right to go to court should a landlord not adequately maintain a property. More information can be found at:

https://www.gov.uk/govenment/publications/homes-fitness-for-human-habitation-act-2018

Fees

  • The commission is due on the rental payment dates as specified in the tenancy agreement. If the tenancy is renewed or extended beyond the initial fixed term agreed period, or if an option to renew is exercised, our commission will continue to be charged at the management rate agreed for the further agreed period or periods.

The Tenant Fees Act 2019

  • This came into force on the 1st June 2019 and unless a fee is considered a ‘permitted payment’ under the Act, all fees to tenants are banned. Fees can no longer be charged to a tenant by an agent or by a landlord directly. Historically tenants have been charged (where appropriate) for Tenant Referencing, Tenancy Agreements, Change of Tenancy paperwork, Guarantor References, Renewal Tenancy Agreements, Check-Ins and Rent Reminder letters. These charges are no longer legally permitted.
  • In accordance with the law, we will no longer charge fees to tenants (unless deemed a permitted payment.) Previously we have incorporated the many changes in legislation to include them within the fees already charged to you – there were seven significant legislation changes in 2018 alone and we’ve ensured that all our clients are compliant as a matter of course at no additional cost. We work hard to deliver the best service at the best possible price and as a company have absorbed the majority of these costs to limit a Tenant Fee Levy to all tenancies charged at 1% (plus VAT). By way of an example on a rent of £1,500 per calendar month an increase of £15 (plus VAT). Please remember that our charges are tax-deductible.

Change of Sharer/Occupent

  • Should your tenant request a change of tenant whereby one person leaves, joins or ‘swaps’ and you consent, we shall oversee the paperwork on your behalf at a cost to you of £300 incl VAT.

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