BUDGET MARCH 2022

A brief summary of some of the main points in yesterday’s budget.

  • National Insurance Threshold and Lower Profits Limit raised  £12,570, from July 2022.
  • Fuel Duty cut by 5p per litre
  • O% VAT for Green Initiatives – it is not yet clear if landlords will be able to benefit from this when making improvements to properties to achieve EPC Grade E as currently required or Grace C as predicted.

These measures include:

  • insulation for walls, floors, ceilings, roofs or lofts or for water tanks, pipes or other plumbing fittings
  • draught stripping for windows and doors
  • central heating system controls (including thermostatic radiator valves)
  • hot water system controls
  • solar panels
  • wind turbines
  • water turbines
  • ground source heat pumps
  • air source heat pumps
  • micro combined heat and power units
  • boilers designed to be fuelled solely by wood, straw or similar vegetal matter

This is alongside an increase in ECO funding from the energy producers.

  • Household Support Fund – an extra £500million funding to local authorities from April 2022
  • Employment Allowance to increase from April 2022
  • Intention to cut and reform business taxes.
  • Intention to reduce the basic rate of income tax to 19% from April 2024 together with reforms to the tax system.
  • Intention to assess the Apprenticeship Levy

No changes in benefits including for Pensioners or those on Universal Credit

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HOUSING UKRAINIAN REFUGEES

The government have agreed measures to assist with housing Ukrainian refugees under the ‘Homes for Ukraine’ scheme. 

Under the scheme anyone wishing to house a refugee or a number of refugees can register on the government website with anyone making an offer being asked to offer a minimum of six months’ accommodation, which would need to be taken into consideration by both the tenant and the landlord before agreeing to be a host.

Hosts, whether landlords or tenants, will not be able to charge rent.  The government will hand out an optional ‘thank you’ payment of £350 per month per residential property to hosts but some or all of this sum may be swallowed in expenses of the refugee until such time as benefits are in place.

Hosts and all adults in the sponsoring household will also be subject to standard security checks as part of the visa process.

The local council will visit the host household to check that the accommodation being offered is appropriate and that everything is in place for your guest(s). They will also conduct a Disclosure and Barring Service check on all adults in the household. This is typically required for people who work closely with children and vulnerable adults – teachers, doctors, social workers, civil servants – and is a simple, standard safety check. You will receive a certificate valid for two years. These checks and the process will be expedited.

For those who are hosting a Ukrainian family which includes a child or a vulnerable adult, an enhanced Disclosure and Barring Service check with Barred Lists check will be conducted.

What accommodation can be offered?

The offered accommodation must be a provision of at least six months of stable accommodation. This can be anything from an empty room to an unoccupied home, as long as it is safe, heated and free from health hazards, and gives the guests adequate access to bathroom and kitchen facilities.

  • The accommodation should be in an empty room
  • A bed in a shared space would not be an appropriate offer of accommodation for 6 months

Where landlords offer a property for the use of a refugee or refugees:

  • No rent may be charged
  • Right to rent checks need to be undertaken

If a tenant wants to offer accommodation,:

  • They will need to have a spare room available in their property (this may not be at the expense of other occupants being put into an over-crowding situation)
  • They will need to have the landlord’s consent
  • The tenant must have at least six months leave to remain in the UK if on a time limited visa
  • The tenant must undertake all Right to Rent checks
  • The tenant may not charge rent other than the payment from government
  • Council Tax Discounts and other benefits will not be affected by the £350 from the government.

Why would a landlord withhold consent?

  • The current tenancy may not be for a period longer than six months with the landlord unwilling to extend that period
  • A breakdown in landlord/tenant relationship may see the landlord unable to obtain possession of the property util the six months has expired
  • Where a property is subject to a licence for a House of Multiple Occupation, the landlord may not be able to permit occupation by any further adults.
  • The landlord’s insurance may prohibit housing of refugees although this can usually be purchased as an add-on where necessary.
  • The landlord’s finance on the property may prohibit the housing of refugees (this should be checked with the company concerned).

Where a landlord and tenant agree that a refugee can be housed, the tenant is responsible for all Right to Rent checks otherwise it is the responsibility of the landlord.

At The End of the Six Months:

When signing up for the scheme landlords and tenants are committing to hosting guests for a minimum of six months

  • The arrangement can continue beyond the initial six months by mutual consent of the landlord, tenant and guest
  • To cancel the agreement after six months, let your guest know in plenty of time (for example, one month) so they can make other arrangements. 
  • Ukrainian people on the scheme will have access to public funds during their time in the UK, and at the end of their sponsorship will be able to rent a property like anyone else. The local authority can assist with finding alternative accommodation in the usual way.

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SUGGESTED NEW YEAR RESOLUTIONS FOR LANDLORDS

Keep Up To Date With Legislation Changes

• Its possibly more important than ever to stay up-to-date with the latest landlord legislation, the increasing burden of legislation can be onerous but landlord associations are there to help.

• Read the CRLA’s monthly newsletter and participate in government consultations.

Stay One Step Ahead Of The Tax Man

• The final deadline for submitting your self-assessment and paying any money you owe as a landlord is 31st January 2022.

• We all hate paying tax and it can be beneficial to get advice from an accountant.

• John Savage offers free initial advice to CRLA members but remember he is swamped with work at this time of year so you may not get a response from him until February.

John Savage Accountancy

Tel: John on 01872 271947

Email: john@johnsavageaccountancy.co.uk

https://www.johnsavageaccountancy.co.uk/

Look After Your Properties

• Schedule regular maintenance and involve your tenant in the timetable.

• Keep a list of reputable tradesmen to hand for emergencies

• Check on your EPC and consider how you can improve the grading. Currently properties not on the Exemptions Register MUST have an EPC rating of E as a minimum, expect that to increase to C over the next few years.

• Make regular property inspections at a time suitable for your tenants.

• Schedule any regulatory inspections such as gas, fire and electric.

• If the property is licensed as an HMO ensure all documentation is supplied to Cornwall Council in a timely manner as specified in your licence.

Review Your Finances

• Your mortgage and loan repayments may have already risen, if not watch out for the extra payments due to come out of your account.

• Is there a better deal for you out there?

Review Your Rents

• Diarise the date for any annual rent review. You can review rents without increasing them!

• Does your rental income cover the costs of the property.

• If you are considering an increase in rent remember to give the required notice on the correct form.

• Minimum notice period is currently one month, three months gives the tenant time to consider and review his or finances.

• Is your tenant a good tenant? You may care to be prepared to negotiate regarding any rent increase.

Make Sure Your Landlord Insurance Covers All Eventualities

• Does your landlord insurance cover all your requirements? If not, when shopping around check the small print in the insurance policy VERY carefully. Two agents wo are very helpful to the CRLA and members are:

John Bateman Insurance Consultants Limited

Tel: 01926 405040 OR 01926 405882

https://www.bateman-group.co.uk/

Alan Boswell Group

Tel: 01603 216399

Email: landlordenquiries@alanboswell.com

https://www.alanboswell.com/

Stay In Touch With Tenants

• The value of regular communication with your tenants cannot be over-emphasised. Try to send all written communications by email or letter and keep a copy with your tenancy paperwork. If you have a discussion with the tenant then make a written note and perhaps send a copy to your tenant so that he or she can agree.

• Always write to the tenant with a report after a property inspection.

• Make sure you respond to any communication from a tenant in a timely manner, let’s say 14 days.

Ask For Help

• The CRLA are only an email or ‘phone call away or advice can be found on the CRLA website

Email: crlawp@gmail.com

Tel: 01872 554498

www.crla.org.uk

• If there is no-one available to answer the ‘phone please leave a message including your ‘phone number so that you can have a call back.

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OPEN LETTER TO LANDLORDS AND AGENTS FROM MINISTER OF STATE FOR HOUSING

Rt Hon Christopher Pincher MP, Minister of State for Housing has written an open letter to all landlords and agents in England with advice on how to enact the government’s Winter Plan to tackle rising cases of Covid-19.

The following is extracted from the letter:

Key messages for Landlords

If you have responsibility as a landlord, whether in the Social Rented Sector or Private Rental Sector, we ask that you help us in our efforts to encourage behaviours to help combat the virus and cascade the message of the importance of good ventilation to your residents. Included in this letter is a  summary of the key messages for residents, from the guidance, and a toolkit of additional materials to cascade through relevant channels.

To support the health of your residents, there are several things you, as a landlord, should do to enable ventilation in and around your residents’ homes:

  • Ensure that all habitable rooms have functioning openable windows (including providing replacement keys where these have been misplaced/lost) – ideally with opening areas of at least 1/20th of the floor area;
  • Ensure that all bathrooms/kitchens have either functioning openable windows and/or (preferably both) appropriate functioning extract ventilation;
  • Consider installing positive pressure or constant run ventilation systems to ensure there is adequate background ventilation and to reduce the likelihood of condensation, and ensure that such systems are operating effectively, with filters etc replaced at appropriate intervals;
  • Ensure that tenants have clear instructions and understand how to operate ventilation and heating systems, and are advised on the best ways to achieve a healthy and economic balance of heating, ventilation and moisture production within the home;
  • Ensure that problems with damp are fully investigated and addressed promptly.

We also request that you prioritise as far as possible any planned or known works that might improve ventilation, such as repairing broken safety catches on windows for those concerned about security or a fall hazard

Click here to read the full letter

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COURT FEES INCREASE FROM 30 SEPTEMBER 2021

From 30th September 2021, court fees for landlord related claims are now:

Claim TypePrevious FeeCurrent Fee
Claim for Possession£355£355
Warrant of Possession£121£130
Claim for Money (up to £10,000)£35 to £455£35 to £455
Debtor Questioning£55£59
Bailiff Service on Debtor£110£119
Warrant of Control£75£83
Attachment of Earnings£110£119
Third Party Debt Order£110£119
Charging Order£110£119

Landlords and lettings agents must ensure the correct fee is paid when issuing claims for possession, money, or enforcement matters.

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