How to Reference a Tenant in England: A Landlord's Step-by-Step Guide

Why Tenant Referencing Matters More After the Renters' Rights Act

Since 1 May 2026, every new private tenancy in England is an assured periodic tenancy with no fixed end date. The tenant can leave on two months' notice ending on the last day of a rent period, but you as landlord can only end the tenancy through a Section 8 possession claim on a statutory ground — and even Ground 8 (serious rent arrears) requires at least three months of arrears at both the notice date and the hearing date. The Renters' Rights Act also caps advance rent at one month, so you can no longer ask for six months upfront as a safety net.

All of which means your tenant referencing process is now your primary defence against financial loss. Get the vetting right before the keys change hands, and you sidestep the expensive problem of trying to regain possession from a tenant who cannot pay.

What You Can Legally Check (and Charge)

Under the Tenant Fees Act 2019, you cannot charge the tenant for referencing. The cost sits entirely with you. You can, however, take a holding deposit of up to one week's rent while you carry out checks. If the applicant fails a Right to Rent check, provides relevant false or misleading information, or withdraws, you may retain the holding deposit. Otherwise, refund it within 7 days of the tenancy agreement, your decision not to proceed, or the agreement deadline, as applicable. The default deadline for agreement is 15 days after receipt unless extended in writing; after signing, the deposit can be applied to first rent or the tenancy deposit only with the tenant's consent.

A thorough reference typically covers four areas:

1. Credit Check

A credit report shows County Court Judgments (CCJs), Individual Voluntary Arrangements (IVAs), bankruptcies, and payment history on credit accounts. You cannot run a credit check yourself against an individual — you need to use a referencing provider that holds the necessary data-sharing agreements with credit reference agencies (Experian, Equifax, or TransUnion).

What the credit check tells you: whether the applicant has a pattern of missed payments or formal debt proceedings. What it does not tell you: whether they will pay your rent on time. A clean credit file is necessary but not sufficient.

2. Employment and Income Verification

Contact the applicant's employer directly to confirm their job title, employment status (permanent, fixed-term, or zero-hours), length of service, and gross salary. For self-employed applicants, request the last two years of SA302 tax calculations from HMRC plus corresponding tax year overviews.

The standard affordability rule used by most referencing providers is that rent should not exceed 30% to 35% of gross household income. On a property let at £1,200 per month, that requires a gross household income of roughly £3,400 to £4,000 per month.

3. Previous Landlord Reference

Ask the applicant's current or most recent landlord whether they paid rent on time, maintained the property reasonably, and left without disputes. Be cautious with this reference: a current landlord who wants the tenant to leave may give a glowing reference to speed up their departure. Where possible, contact the landlord before the most recent one as well.

4. Right to Rent Verification

This is a statutory requirement, not optional due diligence. Under Section 22 of the Immigration Act 2014, you must verify that every adult occupier (18+) has legal permission to rent in the UK before the tenancy agreement is entered into, except in limited cases where the check can be completed before occupation. Three compliant routes exist: manual document check with original documents, Home Office online service using an "R"-prefix share code, or digital identity verification through a certified provider for British and Irish passport holders. Civil penalties for a breach are up to £10,000 per unauthorised occupier for a first offence.

DIY vs. Referencing Services

You have two options: run the process yourself, or use a tenant referencing service.

Self-referencing works if you know what to look for and are comfortable making direct calls to employers and previous landlords. The credit check is the sticking point — you will still need a provider for that element. Cost: typically £15–£30 for a standalone credit check.

Full referencing services (PropertyGoose, OpenRent, Goodlord, HomeLet) handle the credit check, employer contact, previous landlord reference, and Right to Rent verification in one package. Cost: typically £15–£25 per applicant. The service produces a structured report with a pass/fail recommendation.

For a single-property landlord letting for the first time, a referencing service is usually worth the fee. The structured report also serves as evidence of due diligence if a dispute reaches the courts later.

Red Flags to Watch For

• Applicant offers several months' rent in advance (this is now illegal to accept beyond one month, and it often signals difficulty passing standard checks)
• Reluctance to provide employer details or previous landlord contact information
• Inconsistencies between the stated income and the employment reference
• Multiple recent address changes with no clear reason
• Pressure to skip referencing and move in immediately

After Referencing: The Next Steps

Once your applicant passes referencing, the pre-tenancy sequence continues: draft the written tenancy terms, collect the deposit (capped at five weeks' rent if annual rent is under £50,000), protect it in an approved scheme within 30 days, and deliver the statutory document pack before move-in day.

For a step-by-step walkthrough of the full pre-tenancy process from consent to let through to HMRC registration, see the Becoming a Landlord in England guide.

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