The UK Deal Sourcing Compliance Checklist (2026)

Deal sourcing that counts as estate agency work comes with registrations and conduct duties, and HMRC fines businesses that trade without registering. Research by NAPSA, a sourcing trade body, covered in The Negotiator in December 2025 (opens in a new tab) looked at 500 property-sourcing businesses and found that around 90% were operating illegally on surface-level checks alone. The same coverage reports that 136 sourcing firms have been fined a combined total of more than £1.1 million by HMRC for failing to register for anti-money laundering supervision. HMRC publishes the names of businesses it penalises (opens in a new tab), so non-compliance is not just expensive, it is public.

The good news: compliance is a short, well-defined list, and the registrations cost around £1,020 to £1,215 in the first year (single premises, one approved person, including VAT on the redress fee). Here is every registration and obligation that comes with that work in 2026, with real costs and links to the official bodies.

Why sourcing counts as estate agency work

Everything on this checklist flows from one fact: acting on a client's instructions to introduce them to someone who wants to buy or sell property, in the course of a business, is estate agency work under section 1 of the Estate Agents Act 1979 (opens in a new tab), which lists some exclusions, such as work a practising solicitor does in the course of that profession. Calling yourself a sourcer, deal packager or introducer changes nothing: if what you do meets that definition and no exclusion applies, the law treats you as an estate agency business and the registrations below apply.

The compliance checklist at a glance

1. Register with HMRC for anti-money laundering supervision

This is the registration HMRC actively enforces: the fines reported above were for failing to register. Sourcing and introducing businesses must be registered for AML supervision before trading, not after the first deal. HMRC's registration guide for estate agency businesses (opens in a new tab) sets out who must register and how.

The current HMRC fees (opens in a new tab) (in force from 1 December 2025) are:

• £300 application fee, one-off and non-refundable
• £400 premises fee for each premises on the registration, then an annual declaration fee of £400 per premises
• £40 approval fee for each person tested. HMRC's approval checks (opens in a new tab) cover the beneficial owners, officers and senior managers of an estate agency business, and sole practitioners, so every new registration includes at least one
• A small business reduction where turnover is under £5,000: you pay the full fees, then receive a £500 refund once your application or annual declaration is accepted

Registration alone is not enough: HMRC expects a written risk assessment, customer due diligence and records (opens in a new tab) of what you did, and the regulations require staff training (opens in a new tab) if you have a team.

2. Join a property redress scheme

Anyone carrying out estate agency work on residential property in the UK must belong to an approved redress scheme (opens in a new tab) (under the Estate Agents (Redress Scheme) Order 2008 (opens in a new tab)) so that consumers have somewhere to escalate complaints, and GOV.UK warns of fines of up to £5,000 for not joining. There are two approved schemes:

• Property Redress (opens in a new tab): its membership tier cards list £190 + VAT per year for the entry tier, with a fee per complaint, or £280 + VAT per year for the enhanced tier (checked 15 October 2026)
• The Property Ombudsman (TPO) (opens in a new tab) lists full membership at £277.96 + VAT per branch per year, plus a first-time joining fee of £74.26 + VAT, and its full membership explicitly covers buying agents and property sourcing

Either scheme satisfies the legal requirement. Check current pricing on their sites and make sure your membership category actually covers sourcing.

3. Register with the ICO and pay the data protection fee

Sourcers process personal data constantly: investor lists, vendor details, tenancy information, viewing notes. Unless an exemption applies, businesses that process personal data must register with the Information Commissioner's Office and pay the data protection fee (opens in a new tab). Since 17 February 2025 (opens in a new tab) the fee is £52 a year at tier 1 (a turnover of up to £632,000 or up to 10 staff), £78 at tier 2, and £3,763 for the largest organisations, with £5 off for paying by direct debit. The fee is the visible part; the substance is handling data lawfully under UK GDPR: keep investor data secure, say what you do with it, and delete what you no longer need.

4. Hold professional indemnity insurance

Professional indemnity (PI) insurance covers claims that your advice or service caused a client financial loss, for example a deal presented with a miscalculated return. Check your redress scheme's membership terms for any PI requirement when you join, and expect investors to ask whether you hold it before paying a fee. Premiums depend on turnover and cover level, so get quotes from a broker rather than relying on figures from a course or forum.

5. Meet your Estate Agents Act obligations

Beyond registrations, the Estate Agents Act 1979 imposes conduct duties that apply to sourcing businesses:

• If your work is estate agency work, your fee, when it becomes payable and any other payments must reach your client in writing before they are committed (section 18 (opens in a new tab) and the Provision of Information Regulations 1991 (opens in a new tab))
• Disclose any personal interest you have in a transaction (section 21 (opens in a new tab)), promptly and in writing (Undesirable Practices Order 1991 (opens in a new tab))
• Pay deposits you hold, which the Act calls clients' money (opens in a new tab), into a client account (opens in a new tab) without delay, with the holding terms clear
• Do not discriminate against buyers because they will not take up services you offer, such as finance (Undesirable Practices Order 1991 (opens in a new tab))

These duties have teeth: the National Trading Standards estate agency team (opens in a new tab), the lead enforcement authority under the Act, can issue prohibition orders (opens in a new tab) banning people found unfit from estate agency work entirely.

6. Disclose your fees clearly and early

Your sourcing fee, when it is payable, and whether any part of it is refundable must be clear, in writing, before an investor commits money. A non-refundable reservation fee buried in small print is hard to defend if an investor complains to your redress scheme. Fee structures, how to set a fee and disclosure are covered in detail in our guide to property sourcing fees.

7. Comply with the DMCC Act 2024 material information duty

The consumer protection rules in the Digital Markets, Competition and Consumers Act 2024 have applied since 6 April 2025. They protect consumers, meaning individuals acting wholly or mainly outside their business (section 225 (opens in a new tab)), and they work on two levels:

• A listing or deal pack that gives a property and its price is an "invitation to purchase". It must include, among other things, its main characteristics, the total price, who you are and anyone you act for, your business address and any business email address, unless it is already apparent from the context, and leaving out what it must contain is unfair whatever its effect on the decision (section 230 (opens in a new tab)). The total price includes any fees the consumer will necessarily incur; whether your sourcing fee forms part of it is a question for a solicitor
• Leaving out any other information the average consumer needs to take an informed decision is a misleading omission (opens in a new tab), unfair where it is likely to change that decision

The Competition and Markets Authority can enforce this directly, with penalties of up to £300,000 or 10% of turnover, whichever is higher (section 182 (opens in a new tab)). The CMA's unfair commercial practices guidance (opens in a new tab) sets out the regime.

For a property deal, the information an investor needs for an informed decision will usually include the price, tenure, lease terms where relevant, known defects, flood risk, and restrictions. In practice, a properly built deal pack is this duty done systematically. See what goes in a property deal pack for the full structure. Building every pack from one template, which deal packaging software makes easier, helps you cover it on every deal.

Step-by-step: getting compliant from a standing start

1. Set up the business properly: HMRC tax registration, a business bank account, and a client account if you will hold reservation fees.
2. Register for AML supervision with HMRC before you market a single deal, writing your risk assessment and due diligence process at the same time.
3. Join a redress scheme: Property Redress or TPO, on a tier that covers sourcing.
4. Register with the ICO and pay the data protection fee.
5. Arrange PI insurance through a broker, sized to your fee income and deal values.
6. Write your client-facing terms: fees, refund policy, service scope, and a complaints procedure naming your redress scheme.
7. Build a deal presentation standard that covers material information on every deal, so DMCC compliance is baked into the process.

What does full compliance actually cost?

Using the published figures above, a single-premises sourcing business starting from scratch in 2026 is looking at £740 or more to HMRC in year one (the £300 application fee, the £400 premises fee and £40 for each person tested, at least one), £228 to £423 including VAT for a redress scheme depending on scheme and tier (TPO's figure includes its first-year joining fee), and £52 to the ICO: around £1,020 to £1,215 for the registrations with one approved person, including VAT on the redress fee, plus PI insurance. Skipping them costs more: failing to join a redress scheme alone can bring a fine of up to £5,000.

Once registered, the ongoing work is process: due diligence on every client, clear terms on every deal, and complete, honest deal packs. That last part is where presenting deals properly and staying compliant turn out to be the same job.