From 1 December 2014, some landlords will need to check that prospective tenants have the right to live in the UK before letting a property to them. 

For the time being this is a Pilot Scheme and the "right to rent" checks will only apply to landlords in Birmingham, Walsall, Sandwell, Dudley and Wolverhampton. However if this Pilot Scheme is successful the Scheme will be implemented on a phased geographical basis across the UK.

Landlords who fail to comply with the right to rent obligations and let a property after 1 December 2014 to somebody who does not have the right to rent in the UK could be subject to a civil penalty of up to £3,000 per illegal tenant.

The Scheme applies to Residential Tenancy Agreements where the Agreement grants a right of occupation for residential use allowing the tenants to occupy the property as their main home, whether or not the property can be also be used for any other purpose. The Scheme applies to landlords (both businesses and individuals) who let self-contained accommodation, occupiers (including those in social housing) who sublet their accommodation and landlords who are occupiers who take in lodgers to share their accommodation.

Further investigations

If the landlord is uncertain whether the tenants propose to use the property as their only or main home then the landlord may be required to conduct further investigations. The landlord should consider factors such as how much time the occupier will spend at the property, their personal family ties to the home and how much it will be used. Relevant factors will include whether the tenants will keep most of their belongings at the property, whether the tenants will be registered with a doctor or dentist from that address and whether the tenant will use that address for voting purposes. This is not an exhaustive list of factors but if the landlord proposes not to conduct right to work checks on the basis that they do not believe the tenants plan to use the property as their only or main home, then the landlord could be required to produce justification for the reasons they came to that conclusion.

Landlords will also need to be alive to the fact that occupiers who sublet all or part of their accommodation to a person for rent will be a "landlord" for the purposes of the scheme, and may be liable to a civil penalty if they do not undertaken sufficient checks and allow occupation by a subtenant who needs and does not have a right to rent.  Where an occupier sublets and so becomes a landlord, they can ask the superior landlord to agree and, in so doing, the superior landlord could be accepting responsibility for conducting the right to rent checks and also any liability to a penalty.  Landlords may want to check their current Tenancy Agreement in relation to responsibility for subleasing to check whether or not they may have already accepted this type of responsibility in the original Tenancy Agreement.

Where landlords use agents to let or manager their properties, the Scheme allows landlords to agree with an agent in writing who is responsible for fulfilling the requirements of the Scheme and so liable to a penalty.  Landlords and agents should set out in writing the agreed timescales in which checks will be undertaken and also the timescales for a report to be made to the landlord so that they can take any necessary further action.

Sitting occupiers

In addition if a landlord acquires properties with sitting occupiers, then new landlord should liaise with the transferring landlord in respect of what document checks have been undertaken and request copies of any evidence of right to rent retained on file. This enquiry should therefore now form part of the due diligence that a landlord will do before making such an acquisition.

Where a landlord has conducted satisfactory right to rent document checks the landlord can establish a statutory excuse against any liability for a civil penalty. Right to rent checks on prospective tenants may only be undertaken and recorded up to 28 days before the Tenancy Agreement comes into effect.

There are four basic steps to conducting an initial right to rent check:

  1. Establish the adults who will live in the property as their only or main home.
  2. Obtain original versions of one or more of the acceptable documents for adult occupiers.
  3. Check the documents in the presence of the holder of the documents.
  4. Make copies of the documents and retain them with a record of the date on which the check was made.

The acceptable documents that a landlord should request are set out in list A and B of the Code of Practice on illegal immigrants and private rented accommodation. The code of practice can be found here.

If the prospective tenants have the right to rent, the landlord can proceed to let the property. Tenants may have an unrestricted right to rent, or a time-limited right to rent. Where the tenants have a time-limited right to rent, follow-up check will be required within 28 days before the relevant expiry date. If a prospective tenant does not have the right to rent then the landlord should not let the property to that tenant; in these circumstances, if the tenancy proceeds, the landlord could face a civil penalty.

Where the landlord has acquired sitting tenants or conducts a follow- up check on existing tenants, even if the right to work check response is negative (i.e. the tenants do not have or no longer have the right to rent), the landlord is not required to take any steps to remove the occupier from the landlord's property.  In this situation the landlord can maintain an excuse against a civil penalty by making the appropriate reports to the Home Office.

For further guidance and to make a report:

www.gov.uk/report-immigration-crime