Buy-to-let investment is very different to owning your own home. When you become a landlord, you’re effectively running a small business – one with legal responsibilities.
- It’s not your property any more
- When you grant a tenancy to a tenant, you are effectively selling it to them for a period of time. This means that you cannot enter the property unless your tenant agrees.
- Keeping it safe and in good condition
- Section 11 of the Landlord and Tennant Act 1985 states that you, the land lord are responsible for keeping the property in a good condition. This means that all repairs to the structure and the exterior of the property such the installations for the supply of water, electricity, gas and sanitation must be repaired and maintained by you.
If you refuse to carry out repairs, tenants can:
• Start a claim in the small claims court for repairs under £5,000
• In some circumstances, carry out the repairs themselves and deduct the cost from their rent
It is also a legal requirement for you, the landlord to fit and test fire alarms, provide an energy performance certificate.
You can only evict your tenant through the courts
If you would like to evict your tenant, the only way in which you can do so is by the courts. Even if your tenant has only signed up for six months, they have the legal right to stay on if, and the law will continue his tenancy indefinitely.
Even if you have previously agreed that he would move out on the due day, if your tenant wants to stay on, you will have to serve the proper form of notice on him and then go to court to get an order for possession.
Protect your tenants deposit in a government approved scheme
These government-backed schemes ensure your tenants will get their deposit back if they:
• Meet the terms of your tenancy agreement
• Do not damage the property
• Pay the rent and bills
Your tenants’ deposit must be deposited into the government approved scheme within 30 days of receiving it and it must be returned to your tenants within 10 days of you both agreeing how much they’ll get back.
Check your tenant’s right to rent
Before the start of every tenancy, you must check all tenants who are aged 18 and over. If the tenant is only allowed to stay in the UK for a limited time, you need to do the check in the 28 days before the start of the tenancy. Read the Governments website to find out how to make a check.
If you are renting your property you also have some financial responsibilities and are liable for:
Income tax on your rental income, minus your day to day running expenses and if the work you do renting out property counts as running a business you may need to pay class 2 national insurance.
The list above in not exhaustive and the government are constantly introducing new regulations in response to latest issues. If you would like to have a chat about your options as a landlord please can our team on 08000 160 10 10.