A tenancy agreement is something every landlord should consider having in place. It sets out all the key information of the tenancy, such as when the rent’s due and who’s responsible for maintenance.
Read on to find out what your tenancy agreement should include, why you need one, and how to make sure it complies with the law.
A tenancy agreement in the UK is a contract between a landlord and their tenants, which sets out the legal terms and conditions of the tenancy.
Most tenancy agreements will automatically be assured shorthold tenancy (AST) agreements, also known as an assured shorthold tenancy agreement for letting a residential dwelling.
They’ll likely be this type of tenancy agreement if:
A tenancy can’t be an assured shorthold tenancy agreement if:
An assured shorthold tenancy is an agreement between the landlord and tenant that lasts for a minimum of six months.
An AST can have a set term, such as six months or 12 months, or it can be periodic. A periodic tenancy is a rolling agreement between the landlord and tenant with no fixed end date.
Assured shorthold tenancies are the most common type of tenancy. However, there are a range of other tenancy types, including regulated tenancies, company lets, and non-assured tenancies.
Read our guide to the different types of tenancy agreements in the UK for an overview of all the different options.
Even if you don’t have a written contract with your tenant, a tenancy agreement will still be in place. Under s54(2) of the Law of Property Act 1925, a tenancy will exist as soon as a tenant starts paying rent.
However, having a written tenancy agreement allows you to make certain stipulations, such as how and when you’ll review rent or the circumstances under which you may withhold all or part of your tenant’s deposit.
Without a written agreement you won’t even be able to prove how much rent the tenant owes you, and may find yourself caught out.
There are a number of things that you can include in a tenancy agreement. Our free tenancy agreement template covers:
There are other agreements and obligations you may want to consider, including things like:
If you want to add to or remove parts of the tenancy agreement, you should work with a legal professional to do this.
If you’re considering making amendments to the assured shorthold tenancy agreement, you need to make sure that those changes comply with the law.
It’s illegal to discriminate against potential tenants on the grounds of:
If you have any concerns about what you can or can’t include in your assured shorthold tenancy agreement, you should talk to your solicitor.
Meanwhile, our guide to DSS tenants explains more about discrimination and what you can’t include in rental property adverts.
Here are some things to consider when organising your tenancy agreement:
If you want to regain possession of your property, you’ll need to let your tenants know and give them a notice period. An assured shorthold tenancy notice period must be set out in your tenancy agreement.
You could also receive an assured shorthold tenancy notice to quit by the tenant which means they want to leave the property.
Your assured shorthold tenancy agreement notice period must fit in with legal guidelines. Gov.uk’s guide to ending a tenancy gives you an overview of what you need to know.
You can also include an assured shorthold tenancy break clause in your agreement, but it’s best to get legal advice to make sure it’s compliant.
For properties in England and Wales you have a choice of three deposit schemes:
Scotland has its own choice of tenancy deposit schemes, as does Northern Ireland.
Tenants with assured shorthold tenancies can also use a deposit-free scheme.
This deposit alternative allows tenants to pay a small upfront fee (usually around one week’s rent) to take out an insurance policy.
The insurance covers any damage or loss to the landlord’s property, with renters responsible for any outstanding payments at the end of the tenancy.
Read our guide to deposit-free renting for more information.
The introduction of the Tenant Fees Act 2019 means that landlords and their letting agents can no longer charge tenants fees for things like inventories and referencing.
Do you have any unanswered questions about creating a tenancy agreement for your rental property? Let us know in the comments below.
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