Can I sublet my property?

In some cases, you may find that you’re renting from a tenant who rents your home from the owner. This is what’s known as subletting. If you’re considering subletting, here are the answers to two common questions.

Your tenancy agreement should inform you whether you can sublet your property. Most tenancy agreements explicitly state whether you have the right to sublet part or all of the property and whether you must consult your landlord first. As a result, this should be the first thing you check if you’re thinking about subletting.

Most assured and shorthold tenancy agreements will contain a clause or a term about subletting, and if this is the case, it’ll always apply. As such, if the term states that you explicitly require your landlord’s consent, then you must seek it beforehand.

There’s a chance that your agreement doesn’t state anything about subletting. If this is the case, then particular rules will apply.

Generally speaking, for periodic tenancies, you can’t sublet without a landlord’s permission, and they can refuse for any reason.

If you have a fixed-term tenancy, and your tenancy agreement says nothing about subletting, you can sublet, and your landlord’s permission won’t strictly be required. However, if this is the case, you’re still best speaking to them about it first and letting them know what you plan to do.

If you sublet part or all of the property you live in, you essentially become a residential landlord. As such, if you’re going to sublet the property – if your tenancy agreement allows for it – then you should speak to an advisor first. Several effects subletting can have on your personal situation, including:

If you receive benefits or tax credits, subletting may affect these. However, if you consult an advisor, they can do what’s known as a ‘better-off calculation’ for you. This should help you determine how your additional income would affect your benefits or tax credits entitlement.

If you live alone, you’ll receive a 25% single occupancy reduction on your council tax. If you sublet a single room, you’ll lose this discount unless your tenant is exempt from paying council tax, for example, if they’re a full-time student.

If you currently pay tax, then the Government’s rent-a-room scheme means you can earn a sum of money from subletting tax-free.

Here, you can earn up to £4,250 tax-free annually from letting out furnished accommodation in your home. This is halved if you share the income with your partner or someone else. You can let out a room or an entire property floor.

If you’ve currently got contents insurance for your property, you may need to revise this when your property’s sublet. This represents a change in circumstance, and, as a result, your current policy could be invalid. If the cost of your premium rises, consider the new costs when calculating how much you’ll be charging the prospective tenant in rent.

As with any form of tenancy, it’s best to have a written and signed agreement. This way, nobody can be uncertain about their rights and responsibilities. Model tenancy agreement forms are available online, such as this one from .Gov.

Alongside this, it’s also worthwhile drawing up a quick inventory before they move in.

To conclude, subletting can be a great option, but you must be aware of its legalities. Know your options in detail before you decide to advance, and ensure that you speak to your landlord first.