1. The Smoke and Carbon Monoxide Alarm (England) Regulations 2015

2. Gas Safety Week 14-20 September 2015

3. Landlord fined over house of multiple occupancy breach

4. Tenants Working from Home

The Smoke  and Carbon Monoxide Alarm (England) Regulations 2015

In the last Newsletter (Issue 18) we let you know of the proposed introduction of new regulations for Smoke alarms and Carbon Monoxide alarms in all rented properties.  I have been getting many phone calls from concerned landlords wanting to know more before 1^st October when this is scheduled to be introduced.

The draft Regulations are still to be approved by Parliament. The Regulations will be adopted, it's just the finer details which may change from the draft. So please be aware of what they are by reading the Government Guide -  Q&A Booklet for the Private Rented Sector – landlords and tenants

The guidance booklet explains the responsibilities both landlords and tenants in England will face under these regulations, which are expected to come into force from the 1st October 2015. According to these regulations, landlords will be required to  have at least one smoke alarm installed on every storey of their properties and a carbon monoxide alarm in any room containing a solid fuel burning appliance (e.g. a coal fire, wood burning stove) - and to ensure that the alarms are functioning at the start of each new tenancy. Tenants meanwhile will be required to ensure that alarms are in working order throughout the duration of their tenancy.

 Landlords should not just ignore this until October. Following the announcement that smoke alarms are to become mandatory in PRS housing, the Government made a commitment of £3 million to support the delivery of this through the 46 Fire & Rescue Authorities.

Fire Services are already holding drop in sessions throughout the UK where landlords may be able to pick up free alarms.  Contact your Fire & Rescue Service now to see what is available to you.

Gas Safety Week 14-20 September 2015

There are 5 days to go before the campaign starts for Gas Safety week.

We know from our work alongside landlords that you are aware that your rental properties require an annual gas safety check. September is the start of the heating season, when many people will be turning on their boilers for the first time – and it's a time when issues arise. So even if your certificate is valid, it's a good time to look at your gas appliances and check that they are in good working order.

According to Gas Safe, 1 in 6 households has a dangerous gas appliance. Take a look at their How Safe is Your Area map and you will see where that figure comes from.

So don't just think about gas for once a year - Stay Safe – and have gas at the forefront of your mind during gas safety week.

Before any gas work is carried out always check the engineer’s ID card and make sure the engineer is qualified for the work you need doing. Encourage your tenants to do the same.

For more information and to find and check an engineer go to www.GasSafeRegister.co.uk or call 0800 408 5500.

Landlord fined over house of multiple occupancy breach

A landlord has been fined and left with a bill of nearly £6,000 for a breach of overcrowding at his property with an illegal number of tenants. South Kesteven District Council prosecuted Sanjay Patel under House of Multiple Occupancy (HMO) legislation for his property on Launder Terrace in Grantham.

He pleaded guilty to an offence under the Housing Act 2004 at Grantham Magistrates Court on June 18.

In July 2014 an inspection of the property was carried out and it was found that there were six persons in five households in residence despite the licence only permitting five persons in four households.

By the September 2014, Mr Patel had reduced the number of persons residing at the property to the permitted five. 

However, it became apparent to the magistrates during the hearing that he had allowed an additional tenant to reside at the property for the last two-and-a-half years.

Despite correspondence to the landlord on January 19 this year the property was re-inspected and found to be overcrowded again with six occupants in the house.

Magistrates cited Mr Patel culpable for exceeding the numbers of households and persons at the property and the aggravating feature of the case being his financial gain for the period of time of the breach.

He was left with a £6,300 fine, deducted by a third for an early guilty plea to £4,200, £1,453.67 costs and a £120 victim surcharge totalling a bill of £5,773.67.

SKDC’s business manager for Environmental Health Anne-Marie Coulthard said: “Landlords provide a good service for their tenants in South Kesteven and those who own homes where multiple tenants live are more than aware of their responsibilities to never overfill their properties.

“However this case shows that landlords cannot simply ignore orders to not overcrowd their properties and we are pleased magistrates saw it fit to impose this level of fine.

“Our officers will always determinedly ensure housing law is strictly adhered to in rented properties to protect tenants.”

Hot off the press:

A landlord based in Boston was found guilty (in his absence) of failing to comply with improvement notices served by Boston Borough Council on two properties in Tunnard Street and Windsor Terrace. Magistrates fined him £2,000 on each of the offences and awarded costs of £4,480.79 and levied a £200 victim surcharge.

Summer budget and how it will affect landlords

Currently landlords can deduct costs incurred when calculating the tax they pay on their rental income. A large portion of those costs can be interest payments on the mortgage. Whilst Mortgage Interest Relief was withdrawn from homeowners 15 years ago, landlords still receive the relief and is a particular benefit for those liable for the higher tax rates.

The government will restrict the relief on finance costs that residential landlords can get to the basic rate of income tax. It will be phased in over 4 years, starting from April 2017.

The government also proposes to reform how residential landlords can account for the costs they incur in improving and maintaining rental property. Currently, landlords of furnished properties can deduct 10% of their rent from their profit to account for wear and tear, irrespective of their expenditure. From April 2016, the government will replace this allowance with a new system that enables all landlords to deduct only costs they actually incur. Capital allowances will continue to apply for landlords of furnished holiday lets. The government has published a technical consultation which will close on 9^th October. https://www.gov.uk/government/consultations/replacing-wear-and-tear-allowance-with-tax-relief-for-replacing-furnishings-in-let-residential-dwelling-houses

The government will also increase the Rent-a-Room relief from £4250 to £7500 per year from April 2016. The value of this relief has been frozen since 1997 so this increase will allow individuals who rent a room in their main residence to do so tax free on an income of up to £7500 to reflect increases in rent.

Find out the governments fiscall plans in the Summer budget for 2015.

Tenants Working from Home

Landlords have been concerned about allowing tenants to work from home as there has been a worry that by permitting the operation of a business the landlord inadvertently creates a tenancy under the provisions of the Landlord and Tenant Act 1954 and the tenant will then gain the automatic right of renewal provided by Part II of that Act.

To address this the Government introduced the Small Business, Enterprise and Employment Act 2015 which creates a new definition of a ‘Home Business Tenancy’

A home business is defined as any business which can reasonably be run from home but specifically excludes any business for the sale or supply of alcohol. Where a tenancy is a Home Business Tenancy it will automatically be excluded from the Landlord and Tenant Act 1954 and will count as a tenancy of a single dwelling for the purposes of the Housing Act 1988. The Housing Act 1988 already permitted some home working as long as the tenancy was substantially for the purpose of providing the tenant with a home. As a result all forms of home working will now be possible and those tenancies will fall within the Housing Act 1988.

However there are still other issues to take into consideration, including mortgages, superior leases in flats and insurance policies which often have clauses prohibiting business use of the property.

The changes do not apply to new tenancies or renewals of tenancies that existed before the new provisions come into force. The date the provisions will come into force has still to be announced but landlords need to be aware of the potential impact and take legal advice if required.

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