Additional Licensing
A discretionary HMO licensing scheme a council can introduce under section 56 of the Housing Act 2004 to cover smaller HMOs that fall below the mandatory five-person, three-storey threshold. It is separate from selective licensing (which covers all rented homes in a designated area, not just HMOs). Operating an unlicensed HMO where additional licensing applies is a criminal offence with civil penalties up to £30,000 and exposure to a Rent Repayment Order of up to 24 months’ rent.
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Related terms
Landlord Licensing
Local authority schemes that require landlords to hold a licence to let property in a defined area. Three types: mandatory HMO licensing (national), additional licensing (smaller HMOs), and selective licensing (non-HMOs). Operating without a required licence carries fines up to £30,000 and can invalidate possession claims.
HMO (House in Multiple Occupation)
A property let to 3 or more people from 2 or more households who share facilities (kitchen, bathroom, toilet). Any HMO with 5 or more occupants from 2 or more households needs a mandatory HMO licence from the local authority. Many councils also operate additional licensing for smaller HMOs.
Mortgage Interest Tax Credit (Section 24)
The 20% basic-rate tax credit that replaced full mortgage interest deduction for individual UK landlords under section 24 of the Finance (No.2) Act 2015. From 6 April 2020, finance costs (mortgage interest, loan interest, mortgage broker fees) are no longer deductible from rental profits; instead HMRC gives a tax reducer at the basic rate, capped at the lower of finance costs, property profits or adjusted total income after personal allowance. Higher- and additional-rate taxpayers are materially worse off than pre-2017; Limited Company landlords are unaffected because Ltd interest remains a fully deductible business expense.
Stamp Duty Surcharge (Additional Property)
The additional 5% Stamp Duty Land Tax surcharge (England and Northern Ireland, raised from 3% on 31 October 2024) on the purchase of an additional residential property over £40,000, including most buy-to-let purchases and second homes. Applies on top of the standard SDLT residential bands. A separate 2% non-resident surcharge applies to non-UK-resident buyers. Refundable within 36 months if the previous main residence is sold; rules differ in Scotland (Land and Buildings Transaction Tax + 8% Additional Dwelling Supplement) and Wales (Land Transaction Tax + 4% Higher Residential Rate).
Selective Licensing
A local authority scheme that requires every private landlord in a designated area to hold a licence, regardless of property type. Operating without a required selective licence carries fines up to £30,000 and can block possession.
Accelerated Possession
A fast-track court procedure used under a Section 21 notice in England and Wales. Abolished for new claims from 1 May 2026 because Section 21 no longer exists. Possession is now pursued under Section 8 using a specified ground.