Refund deposit after tenant fee ban transition period ends 1st June?

by Readers Question

10:58 AM, 8th June 2020
About 4 months ago

Refund deposit after tenant fee ban transition period ends 1st June?

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Refund deposit after tenant fee ban transition period ends 1st June?

The tenant fee ban transition period ended on the 1st of June 2020 in England.

I have ASTs that started before 1st June 2019 and have transitioned into statutory and contractual periodic tenancies started before 1st June 2019.

My question is do I need to refund the extra deposit taken before to meet 5 weeks deposit rule?

Many thanks

Mike

Editor’s Note: Please see >> https://www.property118.com/official-government-guidance-tenant-fees-ban-released-today/

What does this mean for existing tenancy agreements?

If a tenancy agreement was entered before 1 June 2019, you can continue to require a tenant to pay fees written into that agreement (e.g. check-out or renewal fees) until 31 May 2020.

After 1 June 2020, the term requiring that payment will no longer be binding. Should you, in error, ask a tenant to make such a payment, you should return the payment immediately and must return this within 28 days. If you do not return the payment within 28 days, you will be treated for the purposes of the Act as having required the tenant to make a prohibited payment (a payment that is outlawed under the ban).

You do not need to return any amount of tenancy deposit that is over the cap for tenancy agreements that were entered into before the Tenant Fees Act came into force.”


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Comments

Neil Patterson

11:00 AM, 8th June 2020
About 4 months ago

Hi Mike,

Please see my notes above.

Peter Fredericks

12:57 PM, 8th June 2020
About 4 months ago

I believe it my be the case that a contractual (as opposed to a statutory monthly) periodic tenancy continuing after the fixed period is NOT caught by the Tenant Fees Act, even when the periodic phase of the tenancy commences after 1 June 2020. Is that true?

Dylan Morris

15:06 PM, 8th June 2020
About 4 months ago

Reply to the comment left by Peter Fredericks at 08/06/2020 - 12:57
Yes that’s my understanding. You don’t need to refund any deposit in excess of 5 weeks so long as it has gone periodic either contractually or statutory. (Of course if the tenancy is renewed and a new AST is drawn up the 5 weeks max deposit applies and if over this amount you will need to refund).


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