The government has confirmed the framework for a new mandatory Landlord Ombudsman under the Renters' Rights Act 2025, with binding decisions and compensation of up to £25,000 per complaint, alongside civil penalties of up to £7,000 for a first failure to join the scheme and up to £40,000 for continued non-compliance.
The government has set out how the new mandatory Landlord Ombudsman service will work under the Renters' Rights Act 2025, confirming a compensation cap and a structure that brings private landlords into a redress system that previously only applied to letting agents and social housing.
Under the framework announced in the House of Lords, the Ombudsman can investigate tenant complaints, issue binding decisions, and award compensation of up to £25,000 per complaint. Tenants seeking a larger award retain the option of pursuing the matter through the courts instead. The compensation cap is explicitly aligned with the existing cap for mandatory property agent redress, to keep the two systems consistent.
Who has to join, and what happens if they don't
Every private landlord letting in England will be required to join the scheme, with no exemption for occasional, family, or accidental landlords, other than those whose property is fully managed by an agent already belonging to a redress scheme. Failure to join carries its own financial risk, separate from any individual compensation award:
Civil penalties for landlords failing to join the scheme
| 1st failure | 18% | |
| Continued non-compliance | 100% |
First failure to join: up to £7,000. Continued non-compliance: up to £40,000. Bars scaled to the higher figure.
Source: Renters' Rights Act 2025 government framework announcement, House of Lords, July 2026.
What the Ombudsman can and cannot do
The scheme is designed to handle service-quality and statutory-duty complaints, disrepair, poor communication, unfair deposit deductions, and harassment, rather than rent disputes or possession proceedings, which remain a matter for the courts. Tenants must generally raise the issue with the landlord first and allow a reasonable period, typically 28 days, before referring the matter to the Ombudsman.
No implementation date has yet been confirmed; further legislation is required before membership becomes mandatory, and the government has said landlords will be given sufficient notice ahead of any requirement coming into force.
Disclaimer: This article summarises the government's announced framework, which has not yet been brought into force, and is for general information only. It does not constitute legal advice. Landlords and tenants should seek independent advice specific to their circumstances once the scheme's operational details and start date are confirmed.
The scheme is intended to operate as a faster, lower-cost alternative to court action for tenants, covering complaints about repairs, communication, deposit deductions and harassment, though it will not handle rent disputes or possession proceedings, which remain a matter for the courts. Landlords who currently rely on self-managing their properties, rather than working through a fully managing letting agent already registered with an existing redress scheme, will need to actively register once the mandatory requirement is confirmed and a start date is set.
How the scheme fits alongside existing redress
Until now, only letting agents have been legally required to belong to a redress scheme, under the Enterprise and Regulatory Reform Act 2013, with The Property Ombudsman and the Property Redress Scheme the two existing approved providers. This left a genuine gap for tenants of self-managing landlords, who had no equivalent low-cost route to a binding decision and were often left with court action as their only formal option. The government's stated intention is for the Housing Ombudsman Service, which already administers redress for social housing tenants, to extend its remit to cover the new private rented sector scheme as well, creating a single point of contact across both social and private renting.
The complaint process in practice
Tenants using the scheme will generally need to raise their complaint directly with the landlord first and allow a reasonable period, typically around 28 days, for a response before referring the matter to the Ombudsman. This mirrors the process already used for letting agent complaints, and is designed to encourage direct resolution where possible before a case escalates to a formal, binding decision. The scheme is not intended to replace court action entirely: rent disputes and possession proceedings will remain matters for the courts, with the Ombudsman instead focused on service-quality and statutory-duty complaints, such as repair delays, poor communication, or unjustified deposit deductions.
What landlords should do now
No implementation date has yet been confirmed, and further legislation is required before membership becomes mandatory, but the direction of travel is clear enough that self-managing landlords should not treat this as a distant concern. Landlords who already work through a fully managing letting agent registered with an existing redress scheme are effectively covered through that arrangement, but anyone managing their own properties directly should expect to need to register once the scheme launches, and would be well advised to review their current complaint-handling process now rather than waiting for the requirement to become mandatory.
