Article - Landlord & Tenant

My tenant has just informed me he/she is leaving and asked for a refund on rent paid in advance.  What notice does the tenant have to give me and can I hold onto rent paid in advance?

As usual the answer to this question depends firstly upon the type of tenancy that you have given to your tenant.

If your tenant has been granted an Assured Shorthold Tenancy, usually either for an initial term of six or twelve months and your tenant is still within this initial Shorthold period, then strictly speaking your tenant can only determine the tenancy if the Agreement contains a break clause and only then if the terms of the break clause are followed.

Thus if a tenant wishes to leave during the initial Shorthold period there is no real notice period and the tenant is liable for rent for the Shorthold term (6 or 12 months).  Obviously, this doesn’t usually happen in practice.  More often the reasonable landlord will make informal arrangements with the tenant, maybe along the lines that the landlord will use their best endeavours and advertise for a replacement and the tenant will only be responsible for tent up to the finding of a replacement tenant.  Alternatively, it may be agreed that the landlord keeps any rent deposit previously paid as compensation.

The situation is however, quite different if the tenant has just an Assured Tenancy or has become a Period Assured Tenant because a Shorthold Tenancy has now turned into a Periodic Tenancy at the expiry of the Shorthold element.  Here a tenant can determine a tenancy by service of a Notice to Quit.  The Notice to Quit must be in writing and must give a least 28 days notice.  There is no requirement for any other prescribed information.

Therefore, other than the return of a deposit (which is obviously returned after a satisfactory inspection of the property on termination), if your tenant pays rent one month in advance, you do not have to return any pre-paid rent to your tenant.

An interesting point develops here.  A landlord has more control over notice periods if the tenant is an Assured Shorthold tenant.  Thus, when the initial Shorthold element is close to expiry you may wish to invite your tenant to enter into a further Shorthold Tenancy Agreement.

Article First Published: 15 January 2004

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