HMO licensing fees court case

In the case between HMO landlord Peter Gaskin and the London Borough of Richmond Upon Thames, in early August 2018 the court decided that property licensing fees must be charged in two stages - an application fee to cover only the costs of obtaining authorisation under the scheme, and a licence fee levied only on successful applicants to cover the remaining costs of administration and enforcement.

Read more about the case on the London Property Licensing blog.

Andrew Turner, Chief Executive at buy-to-let mortgage broker Commercial Trust, said:

This is an interesting case which may set a precedent for some landlords and could have the potential to save HMO landlords hundreds of pounds if some local authorities have been charging more than they were legally entitled to for HMO licenses. This is a matter of law and I would urge any HMO landlords that believe they may have been overcharged, to seek professional legal advice.”

On the other hand, this decision is a big concern for the local authorities as it effectively means that the licensing fees cannot assist in paying for enforcement costs. Also, landlords who have been unsuccessful in obtaining licences will be likely to try to obtain a refund of the application fees that they have paid.

Considering the upcoming change with mandatory HMO licensing in October 2018, it is with no doubt bad news for local councils since the law is requiring local authorities to expand their licensing operations at the same time that the courts have made a serious decision on how such work is funded.

Rocktime's verso™ HMO licensing automation software is (and always has been) fully compliant with this ruling, and is the only such licensing system to be at the present time. It also offers multiple payment types depending on the councils position on payment. This includes single or split fees, pay in bulk (for multiple applications, BACS, Cheque or Direct Debit).

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