Six Different Types of Tenancy Agreements for Every UK Tenants

A written tenancy agreement is the proof of evidence which make things clear between you (landlords) and the tenants. But, there are essentially six different types of tenancy agreements which according to the needs and circumstances can be given to a tenant in the UK. Deciding what type of tenancy agreement is right for a tenant requires some deeper knowledge about all the types of tenancy agreements. This blog aims to clearly explain about the different types of tenancy agreements in the UK and, to help guide every landlords and tenants in the UK when letting out or renting a property.

Six Types of Tenancy Agreements

         1. Assured Short-hold Tenancy Agreement (AST)

         2. Assured Short-hold Tenancy Agreement (Room Only)

         3. Excluded Tenancy Agreement (Lodgers Agreement)

         4. Company Let Agreement

         5. Non Assured Tenancy Agreement

         6. Addendum Agreement - Additional Terms

1. Assured Short-hold Tenancy Agreement (AST)

Most tenancies comes under this Assured Short-hold Tenancy Agreement and it is the most commonly used form in the UK. Under Assured Short-hold Tenancy Agreement, the property will be the tenant’s main accommodation, and the landlord don’t live in the property. 

AST can be used for:

 ·Houses and flats (private and not for commercial)

 ·House or flat when rented out as a whole to a group (students, young professionals etc.)

 ·Renting individual rooms to tenants who share facilities.

When you can't use AST Agreement?

· If you’re charging extremely high rent (over £100k per year) or low or no rent.

·  If your property is used for a holiday rental.

Any deposit paid by the tenants must be protected under one of the Government approved tenancy deposit schemes. At the end of the fixed term the tenancy automatically runs on unless you (the landlord) take steps to end it.

Most assured short-hold tenancy agreements will stipulate an initial fixed term of 6 or 12 months. You can’t raise the rent during this time unless the tenant agrees, or there’s a rent review clause in the contract. Once the fixed term is over, if you don’t sign a new contract with your tenant, the tenancy agreement automatically becomes ‘periodic’, moving to a monthly rolling contract with the same rent.

2. Assured Short-hold Tenancy Agreement (Room Only)

The Assured Short-hold Tenancy Agreement (Room Only) applies to tenants whom you're renting out individual rooms.

This is for use where a non-resident landlord rents out an individual room to a tenant e.g. in a shared house or a bedsit. The accommodation will be non-self-contained so that the tenant will share facilities (e.g. a bathroom or kitchen) with other tenants in the same house/building.

The tenancy is an assured short-hold tenancy governed by the Housing Act 1988. Just as in all AST agreements, any paid deposits by tenants must be protected under one of the Government approved tenancy deposit schemes.

If the tenants makes any tenancy arrears or other tenancy breach, under the section 8 of housing act UK.

3. Excluded Tenancy Agreement (Lodgers Agreement)

Lodgers Agreement or Excluded Tenancy Agreement is used if you're a resident landlord and sharing facilities with a tenant (lodger).

The Excluded Tenancy Agreement don’t give the tenant as many protections as an assured short-hold tenancy. As a landlord, you don’t need to protect your tenant’s deposit in a government-approved deposit scheme. And, you can usually evict the tenant without a court order and without giving four weeks’ notice, as long as you adhere to the tenancy agreement.

4. Company Let Agreement

The Company Let Agreement form is used when you're renting your property to company rather than an individual. They must all be incorporated bodies. This tenancy is not an assured tenancy. If you take a deposit it does not need to be protected under one of the Government approved tenancy schemes.  

However, it is a fixed term tenancy which then runs on automatically as a monthly tenancy. You will need to give a notice to quit to terminate the tenancy.

5. Non Assured Tenancy Agreement

This type of tenancy can only be used in particular situations. The Non-Assured Tenancy Agreement is used mainly in three situations:-

 ·When the rent is not more than £250 per year.

 · The tenant has his/her only or main home elsewhere (if a tenant lives with his family elsewhere at weekends and uses the property during the week).  

 · If there are joint tenants each of them must have their only or main home elsewhere.

You need to be sure of this situation and as certain as you can be that it will continue for the duration of the tenancy.

In all of these cases as the tenancy is not an assured tenancy you can take a deposit without having to pay it into the Government's tenancy deposit scheme.

To end this tenancy you do not need to give a Section 21 or Section 8 Notice. This is because it is a common law tenancy. The tenancy starts as a fixed term tenancy. This means that the tenant can stay there until the end of the fixed term so long as he pays the rent/complies with the tenancy terms. You will then need to give a notice to quit to end the tenancy. This has to be on a prescribed form.

6. Addendum Agreement - Additional Terms

Some landlords like to add their own provisions to tenancy agreements and therefore an addendum agreement is added for this purpose. Make sure that if you use the Addendum Agreement this is signed, as well as the tenancy agreement itself.

Things to keep in mind about your tenancy agreement

The Tenancy Agreement must contain a prescribed form of acknowledgement under which the tenant agrees to pay off the Green Deal charge. When a new tenant becomes the bill payer, they must be given a copy of the Energy Performance Certificate (EPC). It must be given before they view the property or at the first viewing and then sign the required acknowledgement in the Tenancy Agreement itself to say that they agree to pay the ongoing Green Deal charges.

Back