The Home Office announced on 20 October 2015 that from 1 February 2016 all private landlords in England will have to check that new tenants have the right to be in the UK before renting out their property. The new scheme will not apply in Scotland, Wales or Northern Ireland for the time being.

Under the new rules, landlords who fail to check a potential tenant’s ‘Right to Rent’ will face penalties of up to £3,000 per tenant. Landlords have the option to appoint an agent to act on their behalf. Where an agent has accepted responsibility for compliance with the new scheme, the agent will be the liable party in place of the landlord.

The new law will mean that private landlords, including those who sub-let or take in lodgers, must check the right of prospective tenants to be in the country to avoid being hit with a penalty. Landlords will need to keep records of the checks they have undertaken for those people who will occupy their accommodation. However, when doing so they will need to be mindful of existing obligations under the Data Protection Act 1998 to protect personal data by keeping it securely and only for as long as is necessary.

Right to Rent checks were introduced in the Immigration Act 2014 and the first phase was launched in parts of the West Midlands and this latest announcement is the next stage of the scheme’s roll out.

The Home Office published guidance in November 2014 setting out the documents that can be relied on to satisfy the Right to Rent check. However, where a potential tenant has an outstanding immigration application or appeal with the Home Office, and are unable to produce evidence of their continuing right to remain in the UK, the landlord will need to conduct a check on that person’s  Right to Rent via the Landlord Checking Service, but the landlord will first need to obtain the Home Office reference number from the prospective tenant. This uses the same Home Office database as the Employer Checking Service, which is not always up to date.

Tenants finding themselves in this situation will potentially be at a disadvantage when seeking a property in the private rental sector as landlords are unlikely to be willing to engage with the additional onerous checking procedure. However, landlords and agents will need to be mindful of the equality legislation and avoid exposing themselves to a potential claim by a tenant who has been refused a tenancy.

In the 2014 Act, the provisions were backed by a “civil penalty scheme”, whereby landlords and their agents could face fines of up to £3,000 per tenant. The Immigration Bill 2015, if approved in its current form, would move the scheme onto a new footing altogether as it would be backed by criminal sanctions. It would create four new criminal offences, two which can be committed by landlords and two which can be committed by their agents, in situations where the landlord or agent knows or has reasonable cause to believe that the person does not have a right to rent. The offences would carry a maximum five year prison sentence and they are likely to further deter landlords from renting to persons, whether British citizens or not, who cannot produce a British passport and thus prove their immigration status without resorting to the Landlord Checking Service.

Under the 2014 Act, it sufficed for a landlord to conduct periodic checks on a tenant’s immigration status. They were then protected from a civil penalty until the next check was due, even if the tenant’s status changed. Now, it is proposed that if the Secretary of State gives notice in writing to the landlord that the person has no right to rent, the landlord will face the criminal penalty if they continue to rent to the tenant, even though the next check is not yet due. It is proposed that these measures be applied to existing tenancies.

It remains to be seen if the Immigration Bill 2015 is passed and becomes law, but landlords and agents should be alert to the new obligations coming into force in February 2016 in the meantime.