The Welsh government has released its fees ban guidance for agents.

The Renting Homes (Fees etc) (Wales) Act 2019 takes effect on September 1.

It will create offences for any landlord or agent in Wales who requires a person to make a prohibited payment.

If an agent or landlord has required a prohibited payment, they will not be able to serve a Section 21 notice.

Tenants can be asked for rent, a security deposit and holding deposit, and asked to pay for services such as utilities and council tax.

Tenants can also be charged for ‘payments in default’ – where, for example, there has been a missed appointment because a tenant has not allowed or been available to give a contractor access as arranged; damage to the property; keys need to be replaced; and emergency or out of hours call-out fees.

A payment in default can only be charged if the tenancy agreement specifically allows it.

Agents and landlords will not be able to charge for admin, check-in and check-outs, inventories or guarantors. Nor will they be able to charge for a change of sharer, or amendments to a tenancy agreement.

Agents can continue to receive referral fees, such as arranging the set-up of broadband for a new tenant, but the tenant cannot be obliged to enter into a specific contract for services.

The new Act caps holding deposits at one week’s rent, which must be repaid to the tenant within 15 days unless otherwise agreed in writing.

While the Act is very similar to the ban in England, there are two major differences.

One is that while holding deposits are capped, security deposits are not.

The Welsh government guidance states: “Although average security deposits tend to be around the equivalent of one month to six weeks rent, there may be circumstances which mean that you may wish to take a slightly higher amount of deposit, for example, should a tenant have pets, which may provide you with peace of mind should damages occur due to those pets. It is permissible to ask for a higher amount of deposit in these circumstances.”

The second major difference is that agents and landlords convicted of taking prohibited payments will be reported to regulatory body Rent Smart Wales.

The mandatory scheme will then consider whether someone is “fit and proper” to hold a licence – ie, to operate.