Landlords are being exposed to civil penalties of more than £5,000 after councils reject HMO licence applications over form errors, according to a warning from licensing specialists who say some authorities are using procedure as an enforcement tool.
Need the wider licensing picture? Read Landlord Knowledge’s Landlord licensing guide for HMO licensing, selective licensing, enforcement risk and the compliance issues landlords should watch most closely.
Why the dispute centres on ‘duly made’ applications
The issue arises where a landlord applies for the wrong type of HMO licence – for example selecting an additional licensing form instead of a mandatory one – even though the property still needs licensing and the licence conditions are materially the same.
According to Landlord Licensing & Defence, some councils are rejecting the application, refunding the fee and then treating the property as unlicensed. That matters because the protection attached to an application that has been duly made can fall away once the council says the submission was the wrong one.
The firm said one landlord was fined more than £5,000 after exactly that sequence. The wider concern for landlords is obvious: even where someone has tried to comply, an administrative mistake can become the trigger for a much larger enforcement action.
Licensing risk is moving beyond the obvious breaches
The legal backdrop sits in the Housing Act 2004, which created the HMO licensing framework used by councils across England and Wales. For landlords, the key point is that licensing risk no longer sits only with obvious non-compliance such as overcrowding, missing certificates or operating outside a scheme. It can also sit in the paperwork.
That comes at a time when HMO regulation is already tightening. Landlord Knowledge recently reported a sharp rise in HMO licence applications as more landlords moved towards shared housing. This site also reported on ministers backing tougher council action against rogue operators.
The latest dispute shows how compliant landlords can still get caught if local processes are unclear or inconsistent. That is an important distinction. Councils are right to act against genuinely unlicensed HMOs, but landlords will ask whether form mistakes should strip away protection when the authority has enough information to process the case properly.
This follows Landlord Knowledge’s April report on landlords pivoting towards HMOs. As more investors enter that part of the market, the cost of getting the licensing process wrong rises with it.
A practical warning sits behind the legal argument. Landlords expanding into HMOs should not assume one scheme application is interchangeable with another, even where the property details look close. Councils may not give the benefit of the doubt, and the clean-up cost can be far higher than the original licence fee.
What this means for landlords
- If you’re applying for an HMO licence: check the exact scheme, property type and local designation before submitting.
- Watch for: fee refunds or rejection notices that may leave the property exposed if the council treats the application as invalid.
- Bottom line: in licensing, admin mistakes can quickly turn into enforcement cases.
Editor’s view
Landlords should not need a tribunal fight to prove they were trying to comply. If councils want to raise standards, the target should be real offenders – not people who ticked the wrong box on a near-identical form.
Author: Editorial Team – UK landlord & buy-to-let news, policy, and finance
Published: 13 April 2026
Sources: Housing Act 2004
Related reading: HMO licence applications rise 40% as landlords pivot to shared housing
