Paragraph 6 I1

(1)

A payment that is required, under a standard occupation contract, to be made in the event of a default by the contract-holder is a permitted payment, but this is subject to sub-paragraph (3).

(2)

In this paragraph, “default” means—

(a)

a failure by the contract-holder to make a payment by the due date to the landlord, or

(b)

a breach by the contract-holder of a term of the contract.

(3)

In the case of a default to which sub-paragraph (4) applies, if the amount of a payment required in the event of the default exceeds the prescribed limit, the amount of the excess is a prohibited payment.

(4)

This sub-paragraph applies to—

(a)

a failure by the contract-holder to make a payment of rent by the due date to the landlord;

(b)

any additional description of default which is specified by regulations.

(5)

In sub-paragraph (3), the “prescribed limit” means a limit specified by, or determined in accordance with, regulations.

Annotations

Commencement

I1: Sch. 1 para. 6 in force at 1.9.2019 by S.I. 2019/1150, art. 2(c)

Notes on the whole Act

Textual amendments

F1: Title substituted (1.6.2026) by Renters’ Rights Act 2025 (c. 26), ss. 45(2), 145(3) (with s. 138); W.S.I. 2026/6, art. 2(c)