If you have been letting property in England for any length of time, you will know the practical differences between Section 21 process (historically used for ‘no-fault’ possession) and the Section 8 process (where specified grounds are relied upon). That landscape is changing.
The government’s implementation is phased, with the core tenancy reforms expected to take effect from 1 May 2026 and further measures such as the Private Rented Sector (PRS) Database and the Landlord Ombudsman expected to follow later.
While the end of Section 21 “no-fault” evictions will attract most attention as the Act removes a route to possession, this also means that we get a system that is more tightly regulated and more actively enforced. The reforms are designed to support more consistent local authority action and higher financial consequences for non-compliance, with councils generally able to retain civil penalty income to fund further enforcement.
The Act and associated statutory guidance broadly split non-compliance into two categories:
Breaches: civil penalties up to £7,000 | Offences: civil penalties up to £40,000 or prosecution |
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A “breach” is generally the category for non-compliance where the local authority can deal with the issue by imposing a civil penalty (up to £7,000). These are not always “small” matters in reality. They can arise from day-to-day management issues, such as getting the process wrong, missing required steps, or not meeting a stated requirement in the way the law expects. | An “offence” is treated more seriously. In these cases the local authority can prosecute, or it can choose to impose a civil penalty of up to £40,000 instead. The key point is that the council has a stronger enforcement toolkit here, and the financial exposure is much higher. |
So, How Does The Sanction Amount Actually Get Decided?
The penalty is not automatically imposed. Local authorities are expected to follow a structured approach and publish a policy explaining how they set amounts. In broad terms, they look at:
How serious the breach or offence is: | The starting point is the intrinsic seriousness of the type of non-compliance. For example, safety-related failures are treated as more serious than paperwork or information failures. |
How blameworthy the landlord is, and whether this is a repeat issue: | Penalties increase where there is a history of non-compliance, where the conduct is deliberate, or where the landlord knew (or ought to have known) they were in breach. |
The harm caused, or the potential for harm: | This is treated as a key factor. The greater the actual harm or the risk of harm, especially to tenants, the higher the penalty is likely to be. |
Punishment and deterrence: | The amount should fairly punish the offender and be high enough to deter them from doing it again. Councils will also think about general deterrence, so that non-compliance does not become a normal cost of doing business. |
Removing any financial benefit from non-compliance: | The aim is that it should not be financially attractive to breach the rules. Even if there is no obvious profit, that does not mean the penalty should be reduced. |
Councils then apply these considerations through a step-by-step framework: start from a seriousness-based starting point, adjust up or down for case-specific aggravating or mitigating factors, sense-check the result against deterrence and financial benefit, and make sure the overall total is proportionate if there are multiple penalties being issued at the same time.
What Does The Council Have To Prove?
Separate from the size of the penalty is the standard of proof the council must meet. This is not uniform and can depend on the enforcement route.
Most offences: if the authority prosecutes, it will need to prove the case to a criminal standard (beyond reasonable doubt).
Rental discrimination and rental bidding: the statutory guidance supports a civil standard approach (balance of probabilities) for the authority’s decision-making.
In practical terms, that affects how strong the evidence needs to be before the council will act.
What Else Is Coming: Registration And Redress
Alongside penalties and the standard of proof, landlords also need to plan for the new compliance infrastructure that is expected to come in during the phased rollout.
PRS Database
This is intended to be a mandatory registration database for landlords and rented properties in England. It is not best described as a licensing system.
Access to possession routes:
Registration is expected to be a condition of using certain possession grounds. If you are not registered, you may be blocked from relying on particular grounds until you correct the position. Anti-social behaviour routes are commonly referenced as not being subject to the same restrictions.
Penalties:
Marketing or letting without an active entry is expected to attract civil penalties (up to £7,000). Providing false or fraudulent information can fall into the higher tier (up to £40,000).
Landlord Ombudsman
Membership is expected to be mandatory, even where a managing agent is used. Failure to join may attract:
up to £7,000 for an initial breach; and
up to £40,000 for more serious or persistent non-compliance.
Because these measures are part of a phased rollout, landlords should keep a close eye on government updates on go-live dates and transitional deadlines.
Rent Repayment Orders: A Financially Material Tenant Remedy
Council penalties are not the only risk. Rent Repayment Orders (RROs) allow tenants (and sometimes councils) to seek repayment through the First-tier Tribunal for specified wrongdoing.
Under the newer regime, RRO exposure is expected to increase significantly, with the maximum period referenced as up to 24 months’ rent in relevant cases.
Example: Rent is £1,500 per month. If an RRO applies at the maximum, exposure could be £36,000.
Two practical points to be aware of:
Superior landlords may be in scope in some arrangements (for example rent-to-rent), so liability risk may not stop with the immediate landlord in practice. Directors and officers: where an offence is committed with consent or connivance, personal liability risk can arise. |
Practical Steps To Reduce Risk Before May 2026
The Renters’ Rights Act 2025 is a shift towards higher financial consequences and more structured enforcement. Landlords who run a compliant operation, keep good records, and update processes ahead of the commencement dates should be well placed. Those relying on outdated templates, informal practices, or “agent-led” compliance without oversight will face a higher risk of penalties and tenant claims.
