Accidental landlord? What you need to know!

Becoming a landlord isn’t always part of the plan. Whether you’ve inherited a property, moved in with a partner while keeping a spare home, or simply can’t sell in a tough market, stepping into the role of a landlord can feel overwhelming. But don’t worry! Many accidental landlords face the same challenges, and with the right guidance, you can turn this experience into a rewarding opportunity.

In this blog, the Tenancy Deposit Scheme lists seven common mistakes accidental landlords often make, and how to avoid them with our 10 point checklist.

Before you rent out a property, it's essential to notify your lender. This is called getting consent to let, and it’s crucial to have in place to avoid breaching your mortgage terms. Some lenders might be happy with this on its own, but others may require you to switch to a buy-to-let mortgage, depending on your situation. Always contact your lender and get their permission before renting out your property. If they require a buy-to-let mortgage, make sure to follow through with that. The last thing you want is to be in violation of your mortgage terms.

One of the most common mistakes new landlords make is failing to protect the tenant’s deposit properly. The law requires you to register the deposit with a government-approved scheme within 30 days of receiving it. Failure to do so could lead to penalties, and worse, cause problems when you need to deduct from the deposit at the end of the tenancy. Ensure that you use a government-approved deposit protection scheme like TDS to register your tenant’s deposit. This ensures compliance with the law and protects both you and the tenant.

Landlord law can feel overwhelming, especially for accidental landlords. There are many regulations to follow, and failing to understand them could result in penalties, tenant disputes, or even legal action. From gas safety to energy performance certificates (EPCs), you need to stay on top of your legal responsibilities.

Download our free guide to landlords annual responsibilities here.

Take time to educate yourself on your legal obligations. For instance, ensure you carry out regular gas safety checks, provide an EPC to your tenants, and adhere to the Minimum Energy Efficiency Standards (MEES). You can access our helpful guide for landlords’ responsibilities, and we’re here to help with all the details you need to stay compliant.

Safety is a top priority for landlords. Missing crucial checks like gas safety certificates, electrical inspections, and ensuring working smoke alarms and carbon monoxide detectors can be not only dangerous but also illegal. If you fail to meet these safety standards, you could face hefty fines or even invalidate your insurance, putting you and your tenants at serious risk. Make sure you schedule and complete all necessary safety checks regularly. You need an annual gas safety certificate, electrical inspections every five years, and working smoke alarms in all properties. Also, remember to install carbon monoxide detectors where necessary. These checks not only keep your tenants safe but also protect your legal standing as a landlord.

It’s tempting to take a laid-back approach, especially if you’re not intending to let the property long-term, or you’re letting to a friend. But managing tenants informally, such as skipping paperwork or relying on verbal agreements, can lead to misunderstandings and disputes later on. It’s much easier to resolve issues, such as late rent or damage, if you’ve set clear terms and kept proper records from the start. Always use a professionally drafted, written tenancy agreement, and ensure both you and the tenant sign it. Set expectations clearly from the outset, including rent due dates, maintenance responsibilities, and what happens if either party needs to break the agreement. Documentation is your best friend! It provides a clear foundation for any future issues.

An inventory is an essential tool for protecting both you and your tenant. Without one, it’s nearly impossible to prove damage or loss when the tenant moves out, and this can lead to disputes over the deposit. Failing to document the property’s condition thoroughly at the start of the tenancy can lead to misunderstandings at the end.
Before your tenant moves in, document everything about the property - from the condition of the walls, floors, and furniture to the appliances and meter readings. Take clear, date-stamped photos or videos of the property to ensure there’s no ambiguity about the condition when the tenant moved in. At the end of the tenancy, refer to this inventory to check the condition of the property and assess whether any deductions need to be made from the deposit.

Many accidental landlords don’t realise that rental income is taxable. Whether you’re letting out a property temporarily or for the long haul, rental income is subject to tax, and you must declare it to HMRC. Failing to declare rental income can lead to penalties, fines, or a hefty tax bill when you least expect it. Make sure you register with HMRC as soon as you start receiving rental income. Keep detailed records of your rental income and any expenses related to your property, such as maintenance costs or agent fees. Consulting an accountant who specialises in landlord taxation can also be helpful to ensure you’re staying on top of your responsibilities. If you’re a non-resident landlord, check whether you qualify for the Non-Resident Landlord Scheme, which helps manage tax obligations in the UK.

To make your landlord journey smoother, here are ten key responsibilities that will keep you on track:

1. Protect the tenant’s deposit: Register the deposit in a government-approved scheme within 30 days.
2. Keep the property safe and compliant:  Stay on top of gas safety, electrical inspections, and smoke alarms.
3. Carry out a proper check-in and inventory: Document everything before tenants move in to avoid disputes.
4. Handle maintenance and repairs promptly: Keep the property in good condition and ensure tenant safety.
5. Respect tenants’ rights and follow the rules: Use a written tenancy agreement and protect your tenants' privacy. Landlords must also verify the tenant’s Right to Rent and provide the latest How to Rent guide at the start of the tenancy.
6. Understand tax responsibilities: Declare your rental income and keep records of your expenses.
7. Keep spare keys: Ensure you have multiple sets of keys for emergencies.
8. Confirm utility accounts are set up in your tenant’s name: Avoid disputes over utility bills at the end of the tenancy.
9. Build good tenant relationships: Clear communication makes the process smoother and encourages longer stays.
10. Be prepared for deposit disputes: Keep good records and use TDS for fair dispute resolution if needed.

Visit our TDS Help Centre for helpful guides, tools, and templates designed to make your life easier.

Some of these resources are available exclusively to landlords who use our free deposit protection scheme, TDS Custodial, or our TDS Insured scheme. Join the Tenancy Deposit Scheme today to access all our resources, templates, and the full tenancy deposit management dashboard to help you manage your property with confidence.