Overview of the Renters’ Rights Act 2025
The Renters’ Rights Act 2025 represents the most significant change to the private rented sector since the Housing Act 1988. By abolishing Section 21 evictions and moving all tenancies to a periodic assured tenancy, the government has created a system where compliance is monitored through digital records and local authority oversight. The Renters Rights Bill, which preceded this Act, established the foundation for a more robust penalty system to enable these new rules to be followed.
Local authorities are now mandated to enforce the provisions of the Renters’ Rights Act 2025. This includes monitoring the Private Rented Sector Database to make sure all landlords and properties are registered. Failure to adhere to these requirements allows local authorities to impose civil penalties. These are often more efficient than pursuing a criminal prosecution through the courts.
Understanding civil penalties in the private rented sector
Civil penalties are financial sanctions issued by a local housing authority under the Housing Act 2004 or the Housing and Planning Act 2016. The Renters’ Rights Act 2025 extends these powers to cover new breaches related to the abolition of fixed term tenancies and the introduction of new possession grounds. Civil penalties provide a mechanism for local authorities to punish non compliance without the delays associated with a criminal court.
When a local housing authority decides to issue a civil penalty notice, they must be satisfied to the criminal standard of proof, beyond reasonable doubt, that a housing offence has been committed. However, the civil penalties process itself is administrative. This allows for quicker enforcement action against rogue landlords while providing the offender with a right of appeal to the First-tier Tribunal.
Role of the local housing authority
The local housing authority acts as the primary regulator within the private rented sector. Under the new legislation, local authorities are encouraged to use civil penalties to fund their enforcement departments. This means that income from a civil penalty notice is typically retained by the local council to facilitate further inspections and investigations within the local community.
Each local housing authority must develop its own civil penalty policies. These policies outline how the authority will determine the level of a financial penalty based on factors such as the severity of the breach and the landlord's history. While local authorities have discretion, they must follow statutory guidance civil penalties to enable fairness and consistency across different regions.
Statutory guidance on civil penalties
The government issues statutory guidance to help local authorities determine the appropriate level of a civil penalty notice. This guidance ensures that civil penalties are high enough to deter future non compliance but proportionate to the offence. Local authorities must consider the financial benefit a landlord may have gained by failing to meet their legal obligations.
The statutory guidance highlights that civil penalties should be used to:
- Punish the offender for the specific breach.
- Deter the offender from committing similar offences in the future.
- Deter others in the private rented sector from similar non compliance.
- Remove any financial benefit gained from the offence.
- Maximum civil penalty for landlord breaches
Under the Renters’ Rights Act 2025, a distinction is made between "breaches" and "offences." A breach generally refers to administrative or procedural failures. The maximum civil penalty for a standard breach of the Act is £7,000. These civil penalties are often applied when a landlord fails to provide the correct documentation or ignores procedural rules regarding the assured tenancy.
For instance, attempting to set a fixed term tenancy, which is now prohibited, can result in a £6,000 fine. Similarly, serving an eviction notice that is not on the prescribed government form also attracts a £6,000 civil penalty. While these may seem like minor errors, the cumulative total of multiple civil penalties for various breaches can be substantial.
Maximum financial penalty for housing offences
For more serious violations, categorised as housing offences, the maximum financial penalty is much higher. Local authorities can now impose civil penalties of up to £40,000 for a single offence. This maximum civil penalty is reserved for the most egregious actions, such as unlawful eviction or failure to comply with an improvement notice.
The local housing authority will assess the level of harm caused to the occupant when determining the final amount. If a landlord commits multiple offences, the local council can issue several penalties. This may result in a total fine that exceeds the £40,000 maximum for a single offence. This highlights the importance of maintaining strict compliance across all property management activities.
Financial implications of unlawful eviction
Unlawful eviction is treated as one of the most serious housing offences under the Renters’ Rights Act 2025 and the Protection from Eviction Act 1977. Any attempt to remove an existing tenant without a court order or through harassment is strictly prohibited. The guide fine for an unlawful eviction is currently £35,000.
Beyond the civil penalty notice, an unlawful eviction can lead to rent repayment orders. A tenant or the local housing authority can apply for rent repayment of up to 12 months. When combined with the civil penalty imposed by the council, the financial consequences of an illegal eviction can be devastating for a landlord's business.
Harassment in the private rented sector
Harassment is another serious housing offence that carries a high maximum financial penalty. Harassment includes actions intended to interfere with the peace or comfort of the tenant, such as cutting off utilities or persistent, aggressive tenant communications. The guide fine for harassment under the new regime is £35,000.
Local authorities use their enforcement powers to target landlords who use harassment as a tool to bypass formal possession proceedings. Because civil penalties can be issued more quickly than a criminal prosecution, landlords found guilty of harassment often face immediate financial sanctions. It is vital that all communications and property visits are conducted within the legal framework to avoid these civil penalties.
Penalties for invalid eviction notices
With the removal of Section 21, landlords must follow specific procedures to end a tenancy using Section 8 grounds. Serving an invalid eviction notice is a breach that local authorities take seriously. If a landlord serves an eviction notice that does not meet the legal requirements, they can face a civil penalty of up to £30,000.
This high penalty reflects the government's intention to prevent landlords from using informal notices to pressure tenants to move. An eviction notice must be in writing and use the correct government form. Any attempt to give verbal notice or use an outdated form will result in an invalid notice and the potential for a significant civil penalty notice.
Restrictions on reletting and selling grounds
The Renters’ Rights Act 2025 introduces new moving or selling grounds for possession, such as Ground 1a (sale) and Ground 1b (landlord or family move-in). To prevent abuse of these grounds, the Act imposes a 12-month restriction on reletting or selling the property after the grounds are used to obtain possession.
If a landlord relets the property within this 12-month period, they may be issued a civil penalty of £25,000. Similarly, selling the property within 12 months after using Ground 1a for a different purpose can lead to the same £25,000 fine. Local authorities monitor these properties through the Private Rented Sector Database to ensure the grounds were used genuinely.
Failure to comply with an improvement notice
An improvement notice is served by the local housing authority when a property has hazards that affect the health and safety of the occupant. Failure to comply with an improvement notice is an offence that allows the local council to impose civil penalties of up to £25,000.
In addition to the financial penalty, the local authority may perform the required works themselves and bill the landlord for the costs. Keeping the property free from Category 1 and Category 2 hazards is a fundamental legal obligation. Ignoring an improvement notice is often seen as evidence of being a rogue landlord, which can lead to further scrutiny and other civil penalties.
HMO licensing and management regulations
Houses in Multiple Occupation (HMOs) are subject to strict licensing and management regulations. Operating a mandatory or additional HMO without a licence can result in a guide fine of £17,000. Furthermore, landlords can face civil penalties for each breach of the management regulations for HMOs.
Management regulations cover safety, maintenance, and waste disposal. Because each individual failure can be treated as a separate offence, a single inspection of a poorly managed HMO can result in multiple civil penalties. For example, failing to maintain fire safety measures in an HMO can attract a £20,000 fine, while failing to maintain the living accommodation itself may result in a £7,000 fine.
Overcrowding notices and safety measures
Local authorities have the power to serve an overcrowding notice if they find a property is housing too many people for its size. Knowingly permitting over-occupation of an HMO or failing to comply with an overcrowding notice carries a civil penalty of £20,000.
Safety measures, including fire alarms and carbon monoxide detectors, are also high-priority areas for enforcement. Failure to take adequate safety measures can result in a £20,000 financial penalty. The local housing authority treats safety breaches with a zero-tolerance approach, as they pose a direct risk to life.
Gas and electrical safety compliance
Maintaining gas and electrical systems is a critical part of landlord legal obligations. Landlords must organise an annual gas safety check by a gas safe registered engineer. Failure to provide gas certificates or maintain these systems can lead to a fine of £12,000.
Electrical safety standards require an inspection every five years. If a landlord fails to supply the required reports to the tenant or the local housing authority, they may face significant civil penalties. These safety regulations are strictly enforced, and non compliance often leads to a civil penalty notice being issued without a prior warning if the breach is deemed dangerous.
The Private Rented Sector Database and fines
The introduction of the Private Rented Sector Database is a cornerstone of the Renters’ Rights Act 2025. All landlords must register themselves and their properties on this database. Failure to register or providing false or misleading information regarding changes under the Renters’ Rights Act is a breach of the Act.
Failing to update the database with the required information can result in a fine of up to £4,000. The database allows local authorities to track enforcement actions and identify rogue landlords across different regions. Landlords who remain unregistered will find it impossible to legally obtain possession of their properties and will face escalating civil penalties for continued non compliance.
Rental bidding and advertised rent
To provide transparency in the rental market, the Renters’ Rights Act 2025 prohibits the practice of rental bidding. Landlords and managing agents must specify the rent in all advertisements. Failure to specify the rent on an advert carries a £3,000 fine.
Furthermore, inviting rental bidding or accepting rent above the advertised rate can result in a £4,000 civil penalty. These rules are designed to prevent the inflation of prices through encouraging bidding wars. Landlords must ensure that the proposed rent is clear and that no offers above this amount are accepted during the application process.
Rental discrimination and legal obligations
The Renters’ Rights Act 2025 makes it illegal to discriminate against prospective tenants who have children or who receive state benefits. This ban on rental discrimination is enforced by local authorities through civil penalties. If a landlord is found to have a policy that excludes these groups, they can be fined £6,000.
This applies to both direct discrimination in adverts and indirect discrimination during the screening process. Landlords must base their tenant selection on affordability and suitability rather than protected characteristics or the source of the tenant's income. Repeated instances of rental discrimination can lead to higher civil penalties and inclusion in the rogue landlord database.
Rent Repayment Orders (RROs)
Rent Repayment Orders are a powerful mechanism used to reclaim rent when specific housing offences have been committed. Under the Renters’ Rights Act 2025, the scope for rent repayment has been significantly expanded. These orders can be applied for by the tenant or the local housing authority through the First-tier Tribunal.
Offences that trigger rent repayment include:
- Unlawful eviction or harassment.
- Failure to comply with an improvement notice.
- Operating an unlicensed HMO or selective licence property.
- Breach of a banning order.
The First-tier Tribunal can order a landlord to repay up to 12 months of rent. Importantly, the Act now allows for rent repayment orders to be made against superior landlords, not just the immediate landlord. This ensures that those at the top of a sub-letting chain cannot avoid financial liability for illegal eviction or poor standards.
The impact of repeat breaches
The penalty system is designed to be escalatory for those who consistently fail to follow the law. If a landlord commits the same offence or a similar offence within a five-year period, the local housing authority has the power to double the combined total of all breaches.
Repeat breaches are viewed by local authorities as a flagrant disregard for the private rented sector regulations. In such cases, the local council is less likely to offer a lower fine and more likely to seek the maximum civil penalty of £40,000 or pursue a banning order. For portfolio landlords, a history of repeat breaches across multiple properties can lead to unlimited fines in a criminal court if the council decides to prosecute.
Banning orders for rogue landlords
A banning order is the most severe administrative sanction a local housing authority can use. It prevents a landlord from letting housing or engaging in property management work for at least 12 months. Banning orders are usually reserved for those convicted of serious housing offences or those who have received multiple civil penalties for repeat breaches.
Breaching a banning order is a criminal offence that can result in imprisonment or a civil penalty of up to £35,000. Landlords subject to a banning order are also listed on the Private Rented Sector Database, which is accessible to other local authorities and, in some cases, the public. This effectively removes the individual's ability to operate within the private rented sector.
Mandatory and selective licensing
Many local authorities operate selective licensing schemes in addition to mandatory HMO licensing. These schemes require all private rented properties in a designated area to be licensed. Failure to hold a selective licence when required can result in a £12,000 fine.
Landlords must proactively check if their property is in a selective licensing zone. Non compliance with licensing requirements not only results in civil penalties but also prevents the landlord from serving valid possession notices. Furthermore, operating without a licence is grounds for a rent repayment order, allowing the tenant to claim back a year's worth of rent.
Written statement of terms and prescribed information
Under the Renters’ Rights Act 2025, every assured tenancy must be documented with a written statement of terms. This replaces the old requirement for a tenancy agreement and ensures that both parties understand their rights under the new periodic structure.
Failing to issue a written statement of terms can result in a £4,000 civil penalty. Additionally, landlords must provide tenants with prescribed information regarding the changes introduced by the Act. Failure to provide this information regarding changes under the Renters’ Rights Act also carries a £4,000 penalty. These administrative requirements are essential for the local housing authority to verify that the tenancy is being managed correctly.
Maintenance of the property and common parts
Landlords are legally responsible for the maintenance of the living accommodation and the common parts of a building.
Failure to maintain these areas can lead to significant civil penalties under the Landlord and Tenant Act 1985 and the Housing Act 2004.
Specific guide fines for maintenance failures include:
- Failure to maintain water supply and drainage: £10,000.
- Failure to maintain common parts (e.g., hallways, stairs): £7,000.
- Failure to maintain the structure of the living accommodation: £7,000.
- Failure to provide adequate waste disposal facilities: £7,000.
Local authorities conduct inspections using the HHSRS to identify these issues. If a landlord fails to address these maintenance problems, the council will issue an improvement notice, and subsequent non compliance will lead to higher civil penalties.
Appealing a civil penalty notice
Landlords have a statutory right to appeal a civil penalty notice if they believe it has been issued incorrectly. The process follows a specific legal timeline that must be strictly adhered to.
Step 1: Receiving a notice of intent
Before a local housing authority can impose a civil penalty, they must serve a notice of intent. This document outlines the proposed rent repayment or penalty amount and the reasons for the local authority's decision. The landlord then has 28 days to make representations to the council, providing any mitigating evidence or challenging the facts of the case.
Step 2: Receiving the final notice
After considering any representations, the local authority will decide whether to proceed. If they do, they will issue a final notice confirming the civil penalty and the payment terms. This notice will also include information on how to appeal to the First-tier Tribunal.
Step 3: Lodging an appeal with the First-tier Tribunal
Once a person receives a final notice for a civil penalty, they can appeal to the First-tier Tribunal (Property Chamber). This appeal must be lodged within 28 days from the date the final notice was issued. The appeal acts as a stay on the penalty, meaning the landlord does not need to pay until the tribunal has made a decision.
Step 4: The tribunal hearing
The First-tier Tribunal will conduct a re-hearing of the case. They can consider new evidence that was not available to the local housing authority at the time the notice was issued. The tribunal has the power to confirm, reduce, or cancel the civil penalty notice. If the appeal is unsuccessful, the landlord may be ordered to pay the local authority's legal costs.
Energy performance certificate (EPC) requirements
The government continues to use energy performance certificate (EPC) standards to drive improvements in the private rented sector. Currently, it is an offence to let a property with an EPC rating below 'E'. Letting a property that does not meet these minimum standards can result in a financial penalty from the local housing authority.
Under the Renters’ Rights Act 2025, these standards are expected to become more stringent. Landlords should ensure their properties are energy-efficient to avoid civil penalties and to improve the property's marketability to a prospective tenant. Local authorities can check the EPC register remotely and issue penalties for non compliance without physical inspections.
Are civil penalties enforceable?
Yes, civil penalties are legally enforceable debts. If a landlord fails to pay a civil penalty notice and does not lodge an appeal, the local housing authority can apply to the county court for an order to recover the debt as if it were a court judgment. This can lead to bailiff action or a charging order against the landlord's property.
Furthermore, failing to pay civil penalties can have wider implications for a landlord's business. It may be used as evidence that the landlord is not a "fit and proper person" to hold an HMO or selective licence. Unpaid penalties are also recorded on the Private Rented Sector Database, which may lead to a banning order.
What is the new law for landlords in 2026?
By 2026, the Renters’ Rights Act 2025 will be fully embedded in the private rented sector. The key changes include the total abolition of Section 21 "no-fault" evictions and the requirement for all tenancies to be periodic. Landlords will be required to use the updated Section 8 grounds to obtain possession, which include new provisions for selling the property or moving back in.
Additionally, the Private Rented Sector Database will be the primary tool for compliance. Landlords who are not registered by this time will be unable to legally let their properties and will face immediate civil penalties. The standards for property safety and energy efficiency are also expected to be higher, with local authorities using their expanded enforcement powers to issue more frequent civil penalties.
How AST Assistance can help
Working through the Renters’ Rights Act 2025, landlord obligations and the increased risk of civil penalties requires careful, informed guidance. The requirements for maintaining a compliant tenancy are now more demanding, and mistakes in notices, documentation or tenancy management can expose landlords to delays, enforcement action and significant financial penalties.
AST Assistance provides specialist support to UK landlords, property investors and managing agents, helping them protect their properties, rental income and legal position. Our team works exclusively with landlords, offering practical advice and hands-on support across a wide range of tenancy and compliance matters.
Our services include:
- Possession proceedings: we help landlords adapt to the move from Section 21 to the new Section 8 framework, preparing notices correctly, identifying the right grounds and handling possession claims in line with current requirements.
- Landlord obligations: we advise on key compliance duties, including property standards, safety requirements, licensing, deposit protection and documentation, helping landlords reduce the risk of enforcement action.
- Tenancy agreements: we can review, update and prepare tenancy agreements so they reflect current legislation, protect your interests and provide a clear framework for managing the tenancy.
- Compliance audits: our specialists can assess your portfolio and identify areas of risk, including registration, licensing, safety certificates and tenancy documentation.
- Civil penalty support: if you have received a notice of intent or final notice, we can assist with representations, appeals and the steps needed to protect your financial position.
- Landlord and tenant disputes: we support landlords dealing with rent arrears, property damage, breaches of tenancy, access issues, repair disputes and wider tenancy management problems.
- Mediation services: where appropriate, we help landlords resolve disputes before they escalate to formal proceedings or local authority intervention.
Early advice can help you avoid costly mistakes, protect your rental income and keep your tenancy management on firm legal footing. Contact AST Assistance today on 01706 619954.
