While the rent cap is in place, you can apply to Rent Service Scotland (RSS) to increase the rent above the amount set by the cap if you can show an increase in certain costs associated with the let property.
You will need to tell your tenant that you are making this application.
The property costs which can be counted for this are:
- the interest payable on any mortgage or standard security over the rented property
- any insurance premium you pay which relates to offering the property for rent. For example, landlords’ insurance. Increases in premiums for building or property insurance are not included.
- any service charges related to the rented property that the tenant pays towards as part of their rent, if this was agreed between you and the tenant as part of the terms of the tenancy
The amount the rent can increase
While the rent cap is in place, you can apply to Rent Service Scotland to increase the rent for a property to cover up to 50% of the increased costs. You cannot increase the rent by more than 6% of the existing rent.
So it will be the lower amount of either 50% of the increased costs or 6% of the existing rent.
What you need to do
You should apply to RSS, including proof of the increase in costs. You must also give your tenant notice in writing when you apply.
You also must give your tenant certain information, including:
- the current rent for the property
- the proposed increase
- certain information about the costs that have increased
- a statement that the rent will not increase unless and until the rent officer makes an order setting the rent for the tenancy, or, if the rent officer's order is appealed, until the Tribunal makes an order setting the rent.
You can find a letter template and further guidance on gov.scot.
Once a decision has been made on the rent increase
If Rent Service Scotland agree that you can increase the rent, they will let you and the tenant know. You cannot increase rent until you get approval from Rent Service Scotland. You cannot apply the increase until at least 3 months after the date of your application.
If you disagree with the rent officer’s decision, you can appeal by applying to the First-tier Tribunal for Scotland (Housing and Property Chamber). Your tenant can also do this. If your tenant appeals, then you cannot increase rent until the Tribunal makes an order confirming that you can do so.
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