In December 2014 England’s West Midlands saw the introduction of the Right to Rent Pilot, which over the past year was deemed to be a success by the Government, which maintained it aided letting agents to cut down on rogue landlords that were targeting vulnerable migrants. The Scheme was also seen to have helped regulate and cut down on irregular migrants renting in England.

The scheme and Right to Rent requirement will now be rolled out on a national scale on February 1st2016.

The upcoming change has been greeted with mixed feelings as experts anticipate that foreign nationals will be discriminated against when landlords are looking to rent out their properties. Additionally, there is the belief that landlords are not immigration experts so errors could be made which lead to unfair prosecutions. Despite such criticism the Government intends to go ahead with the changes as they continue to push the initiative of – “creating a hostile environment for illegal migrants”.

Upcoming Changes

As of February 1st 2016 the Government will require all private landlords to check the “Right to Rent” status of tenants that expect to occupy the property as their only or main home and are aged 18 years old or over.

A property will be regarded as a tenant’s only or main home if:

  • They live at the residence for most of the time
  • They keep the majority of their belongings there
  • Their partner or child/children live with them
  • They are registered to vote at the property
  • They are registered with the doctor using that address

The February 2016 change will require all landlords to check all potential adult tenants’ permission to reside in the UK within 28 days before the start of a new tenancy. Landlords will be required to check documents of tenants from either List A or from List B – we explain the difference between the two below.

Upon receiving a document from either List A or List B landlords should complete the following step-by-step checklist:

  • Obtain relevant document/s
  • Check that the relevant document/s is genuine and belongs to the tenant, with the tenant present so that the document’s validity can be confirmed
  • Copy the relevant document/s and retain copies in a data log stating when the check was made and if follow up checks are necessary.

List A: Group 1- Acceptable single documents

If a landlord receives one of the following documents from a tenant they will not be required to repeat the check for that particular tenant – they include but are not limited to:

  • Original UK / EEA Passport
  • Original UK/ EEA National Identity Card
  • Original Permanent Residency Card
  • Original Biometric Immigration documents issued by the Home Office with no limit on right to stay in the UK
  • Original Certificate of Registration or Naturalisation as a British Citizen

List A: Group 2- Acceptable document combinations

Should a landlord wish to rely on documents in List A: Group 2, they will need to ensure that they use two documents from the list and that the documents have been dated to show they were issued within the last three months. Additionally, the documents must contain the name of the prospective tenant.

Documents in this list could include, but are not limited to:

  • A full birth or adoption certificate issued in the UK, the Channel Islands, the Isle of Man or Ireland, which includes the name(s) of at least one of the holder’s parents or adoptive parents
  • A letter issued within the last 3 months confirming the holder’s name, issued by a UK government department or local authority and signed by a named official (giving their name and professional address) or signed by a British passport holder (giving their name, address and passport number)
  • Letter from a UK further or higher education institution confirming the holder’s acceptance on a course of studies

List B- Documents Where a Time-Limited Statutory Excuse is established

All documents in List B must be valid at the time of the Right to Rent check is carried out, further checks should also be conducted where:

  1. One year has lapsed from the date on which the checks were last made; or
  2. Before the person’s leave (immigration permission) to be in the UK expires; or (whichever is longer from a or b)
  3. On the expiry of the person’s permission to stay in the UK as shown on their Biometric Residence Permit.

Documents that could be reviewed by the landlord include:

  • A valid original passport or other original travel document endorsed to show that the holder is allowed to stay in the UK for a limited period of time
  • A valid original biometric immigration document issued by the Home Office to the holder, indicating that the holder has permitted stay in the UK for a limited period of time
  • A valid original residence card issued by the Home Office to a non-EEA national who is either a family member of an EEA or Swiss national or has a derivative right of residence

Penalty for Illegal Renting

Through the introduction of harsher penalties the Government hopes to regulate and cut down on irregular migrants renting in England.

Landlords that are found guilty of failing to comply with the Right to Rent Scheme will be subject to a civil penalty. A civil penalty is a financial penalty issued as restitution for wrongdoing. Should a landlord fail to comply with the Scheme they could face up to a £3,000 fine per tenant. By receiving a civil penalty individuals could also face a loss of professional reputation, impact on their credit rating and possibly rejection of future visa applications.

The Home Office will be introducing a three stage approach in determining a landlord’s liability and how to calculate the civil penalty that will be imposed.

Stage One: Determining Liability

The Home Office gauge breaches by reviewing the answer to the following question:

  • Where a landlord has been found to have authorised occupation of their property to someone that has no right to rent, does the landlord have a statutory excuse?

If a statutory excuse is provided, the Home Office will issue a No Action Notice. If a statutory excuse cannot be provided, the Home Office will initiate Stage Two.

A statutory excuse could be that the landlord has correctly carried out the prescribed Right to Rent Checks using documents in List A or List B, and continued to make the necessary reports. Where a tenant has limited right to rent due to limited stay in the UK, the landlord will be classed as having time limited statutory excuse and will therefore have to have conducted the necessary follow-up document checks to retain this excuse. If follow-up checks show that the occupier no longer has the right to rent, the landlord will be required to report this to the Home Office.

Stage Two: Determining the Level of Breach

The Home Office will check to see if the landlord has breached the Right to Rent Scheme in the previous three years.

If a previous breach has occurred in the last 3 years the new breach will be regarded as a Level 2 (subsequent breach). If there has been no previous breach in the last 3 years the breach will be classed as a Level 1 (first breach).

Stage Three: Calculating the Penalty Amount

Level 1 (first breach)

Depending on the type of tenancy a landlord will fall into either of the two subcategories, each subcategory holds a different level of fine:

  • Category A (lodgers in a private household) £80 fine
  • Category B (occupiers in rented accommodation) £1,000 fine

Level 2 (subsequent breach)

Landlords that have been found to breach more than once in a three year period will fall under this category, below are the two types of tenancy breach’s that a landlord may fall under:

  • Category A (lodgers in a private household) £500 fine
  • Category B (occupiers in rented accommodation) £3,000 fine

Concusion

The intended change will have a huge impact on landlords as they risk civil penalties for non-compliance. Therefore landlords should follow the four points in the checklist below to ensure compliance:

  1. Check which adult/s will be living at your property as their only or main residency.
  2. Check to see what relevant document/s should be provided by the tenant/s to prove that they have the right to reside in the UK
  3. Check that the relevant document/s is genuine and belongs to the tenant, with the tenant present so that the document’s validity can be confirmed
  4. Copy the relevant document/s and retain copies in a data log stating when the check was made and if follow up checks are required.