Abolishing fixed term assured tenancies

PIMS Technical Legal Issues

After the Renters Reform legislation becomes law, most tenancies will become periodic tenancies. The default rent period must not exceed one month, unless the landlord and tenant agree otherwise.

Frequently Asked Questions

Will tenancies automatically become periodic?

Yes. Under the proposed legislation, new assured tenancies will normally be periodic from the start rather than fixed term.

What will the default rental period be?

The default rental period will normally be monthly. The law states that tenancy terms providing rent periods longer than a month will generally have no effect unless both parties agree otherwise.

Can landlords and tenants agree different terms?

Yes. The legislation states that nothing prevents the landlord and tenant from varying a tenancy term by agreement. This means both parties can agree different arrangements if they wish.

What about Council Tax liability?

Under current council tax regulations, if a tenancy is granted for less than six months, the landlord can become liable for the council tax.

This raises a practical issue where tenancies become periodic from the start. Landlords should therefore be aware that local authorities may still attempt to hold the landlord liable for council tax where the tenancy arrangement is treated as short-term.

Should landlords grant six-month tenancies?

This may need to be considered depending on how council tax liability is interpreted in practice. Landlords should monitor guidance from local authorities and the courts once the legislation comes into force.

Relevant Legal Provision

Default rental period not greater than monthly

Terms of an assured tenancy providing rent periods are ineffective if they provide for a rent period exceeding 28 days unless structured as monthly rent periods.

Variation by agreement

The law also states that nothing in this section prevents the landlord and tenant from agreeing to vary a term of the tenancy.

Note: Legislative references such as Chapter 1 Section 1 are included for technical interpretation of the legislation.