Key Lettings Legislation and Compliance Dates for 2023 and beyond

11th January 2023

We believe that it is essential that property owners remain up-to-date with all legislation and compliance dates; that’s why we have outlined some of the main lettings legislation and compliance dates for the new year from 2023 and onwards.

Tax loophole on second homes to close (England)

Second homeowners that currently benefit from business rate relief on their second property will need to rent it out for a minimum of 70 days per year to continue to access the relief, rather than paying council tax, from April 2023. The property will also have to be “available to rent” for a minimum of 140 days per year. To support the change in criteria, advertisement resources such as websites, brochures, letting details and receipts could all be used as evidence of compliance.

The new rules on council tax will aims to encourage more empty homes “back into productive use, while raising additional revenue to support local services and keep council tax down for local residents.”

On the topic of closing the tax loophole around business rates,

The Secretary of State for Levelling Up, Michael Gove, commented on the tax loophole stating “that the need to prove that a property is a genuine holiday let “will create a fairer system, ensuring that second homeowners are contributing their share to the local services they benefit from.”

Parliamentary Session: Legislation for the Renters’ Reform Bill (England)

We can expect the Renters’ Reform Bill to be debated and voted on before May 2023; this change in legislation will instrumentally change the lettings industry and current landlord practises. The proposal is to include the abolishment of ‘no fault’ Section 21 evictions, strengthen section 8 and introduce a new Ombudsman and property portal for landlords.

The government is currently in talks with key stakeholders to ensure that the bill considers a wide variety of views on the topic, with a -now closer – call for evidence, and a new consultation on applying the Decent Homes Standard to the private rented sector.

For further information, take a look at our previous article and find out how this will affect the student sector- https://bit.ly/rentersreformbill

Making Tax Digital for Income Tax Self Assessments (UK)

For landlords registered for Income Tax Self Assessments and with an annual business or property income above £50,000, income and expenses will need to be submitted digitally four times a year from 6 April 2026, and allowances and adjustments at least once a year, under Making Tax Digital.

For further information, take a look at our useful guide –https://bit.ly/makingtaxdigitalguide

Increasing Minimum Energy Efficiency Standards (England and Wales)

It’s expected that from April 2025, all new tenancies for privately rented properties will require an Energy Performance Certificate (EPC) rating of C or above, up from the current requirement of a band E rating. However, this increase in minimum energy efficiency standards is awaiting government feedback and further consultation. From 2028, this increase will apply to all tenancies. This new legislation would also increase the capped amount that landlords would be required to invest to achieve the higher ratings, from £3,500 to £10,000.