The law changed on 1 May 2026. The Renters’ Rights Act 2025 raised the maximum Rent Repayment Order from 12 months’ rent to 2 years’ rent, and extended the deadline for applying from 12 months to 2 years from the date of the offence.
These new limits apply to offences committed on or after 1 May 2026. If your landlord’s offence was committed before that date, the previous rules still apply to you: a cap of 12 months’ rent, and 12 months to apply. Not sure which applies? Tell us the dates and we will work it out for you.
A Rent Repayment Order is rarely the only consequence of letting an unlicensed property. This guide sets out the full range of what a licensing breach can cost a landlord — useful if you are a landlord putting things right, and useful if you are a tenant wondering why your landlord is taking your claim so seriously.
The financial penalties
Civil penalty — up to £40,000
Under section 249A of the Housing Act 2004 a local authority can impose a financial penalty of up to £40,000 for a licensing offence as an alternative to prosecution — raised from £30,000 by the Renters’ Rights Act 2025. It goes to the council, not to the tenant, and it can be imposed per offence — so a landlord with several unlicensed properties can face several penalties.
Prosecution and an unlimited fine
The council can instead prosecute in the magistrates’ court. A conviction for managing an unlicensed HMO carries an unlimited fine.
Rent Repayment Orders
Separately, and in addition, tenants can recover the rent they paid — up to 2 years’ rent for offences committed on or after 1 May 2026.
These stack, and one makes the others worse. Under section 46 of the Housing and Planning Act 2016 the tribunal must award the maximum RRO where the landlord has been convicted of the offence or received a financial penalty for it — and also where they are a repeat offender. The tribunal’s discretion to reduce the award disappears entirely.
Every tenant claims separately
An unlicensed five-bedroom HMO is not one claim. It is potentially five, each for that tenant’s own rent, and former tenants can join in for up to two years afterwards.
Banning orders
For serious or repeated offences, a council can apply to the First-tier Tribunal for a banning order under the Housing and Planning Act 2016, prohibiting a person from letting property, engaging in letting agency work, or both, for at least 12 months.
Breaching a banning order is itself an offence — and itself a ground for a further Rent Repayment Order.
The reputational side
A public compliance record
The Renters’ Rights Act 2025 creates a national Private Rented Sector Database, expected to launch during the second phase of implementation in late 2026. It replaces the old Database of Rogue Landlords with something far more visible: a mandatory register of landlords, recording civil penalties, banning orders and relevant offences, which prospective tenants will be able to check before taking a tenancy.
The practical shift is that enforcement history stops being something buried in a council file and becomes something a tenant can look up.
Fit and proper person
Licences are granted only to a “fit and proper person”. Convictions, penalties and enforcement history all feed into that assessment — so a breach at one property can obstruct licensing at others.
Insurance and lending
Landlord insurance and buy-to-let mortgage terms commonly require compliance with licensing obligations and disclosure of convictions or enforcement action. The effect on insurance and mortgages is worth its own read.
Other consequences of being unlicensed
- Management orders. A council can take over management of an unlicensed property and collect the rent itself.
- Restrictions on possession. Extra legal restrictions apply to landlords of unlicensed properties, and section 21 no longer exists as a route in any event.
- Tenant confidence. A landlord who cannot produce a licence has very little answer when a tenant asks the obvious questions.
If you are a landlord: what to do
- Check every property, in every borough. Mandatory licensing is national. Additional and selective licensing are local, time-limited and change.
- Re-check when occupancy changes. One extra occupier can push a property over a threshold without any change of tenancy.
- Apply before letting, and keep dated proof — submission, reference number and fee payment. That evidence is the entire section 72(4) defence.
- Diarise expiry dates. Licences last a maximum of five years and designations lapse.
- Remember a licence cannot be transferred. If you buy, or move a property into a company, you need your own.
- Take advice early if a claim lands. Engaging properly and putting your evidence in on time affects the award, because conduct is a statutory factor.
If you are a tenant
This is why some landlords settle. The exposure is not just your claim: it is your housemates’ claims, the council’s penalty, the effect on their other properties, and a compliance record that is about to become public.
It is also why reporting the matter to the council is worth doing alongside your own application. If the council convicts or fines the landlord, the tribunal must award you the maximum.
Not sure whether your landlord needed a licence? Send us the address and the dates you lived there and we will check — free, and with no obligation. Check your claim →
This article is general information about the law in England and is not legal advice about your own circumstances. Penalty levels, enforcement policy and the timetable for the Private Rented Sector Database are subject to change. The rules differ in Wales, Scotland and Northern Ireland.
Think this applies to you? Checking whether your landlord needed a licence is free and takes about two minutes. Check your claim — free, no obligation.