A lodger agreement is a type of common law tenancy where the lodger shares the property with the landlord, but usually has exclusive possession of their room. A common law tenancy arises if the... ... Read more
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How to Make a Lodger Agreement for Scotland
A lodger agreement is a type of common law tenancy where the lodger shares the property with the landlord, but usually has exclusive possession of their room. A common law tenancy arises if the occupier lives in the same property as the landlord but has exclusive possession of part of the property (eg they have their own bedroom).
If you're a resident landlord in Scotland and want to rent out a room in your property, you'll need a lodger agreement. A lodger is someone who rents a room in your home and who may share the bathroom, kitchen and/or living room with you. Use this lodger agreement to set out the agreed terms of the lodging arrangement, including the rental amount, the details of the property, any shared areas and restricted areas.
This document is for Scotland only.
Use this lodger agreement if you:
want to rent out a room in your property
are a resident landlord
are sharing the property and common areas with the lodger
only for property located in Scotland
This lodger agreement covers:
the start date of the lodging
the end date of the lodging
the name of the landlord and lodgers
shared areas in the property
rent payable and due date
whether bills are inclusive or exclusive
ending the lodger agreement
Whilst common law tenants are not regulated by statute or the law, it's still recommended to have a lodger agreement in place. The agreement can be in writing or verbal. However, it's always best to get it in writing if possible. This will help prevent disputes about the terms of the lodging arrangement and clarify things from the start.
Unlike private residential tenancies, if you are using the home as your only and main residence and there will be no more than 2 lodgers in your property, you won't need to be registered as a landlord.
To be classed as a resident landlord, you must:
use the property as your only or main home (if you only stay in the property occasionally and have another home elsewhere, you won't count as a resident landlord); and
have direct access from your accommodation to the lodgers (for example, a landlord living in a separate flat in the same building as you won't count as a resident landlord; a landlord who has separate rooms in the same house as the lodger will).
If you own your home, you can usually take in a lodger. However, if you have a current mortgage then you may need to inform or ask your mortgage company for permission. Most mortgage agreements allow you to rent out a room in your home, but you usually need permission from your lender. Check your mortgage agreement to see what it says. If it says you need permission, it's important to get this before anyone moves in. If you don't, you could be breaking your agreement and your lender may take you to court. Taking in a lodger is not always allowed, and some lenders refuse to give permission if you have mortgage arrears.
Find out more about taking in a lodger.
You won't always need to inform your insurers, however renting out a room in your home may also affect your contents insurance. To make sure your belongings continue to be protected against theft or damage by a valid insurance policy, you should inform your insurers of the new situation. This may mean they will increase your premiums. However, you should read your insurance policy to see what it says regarding lodgers or contact them if your policy doesn't say anything.
You don't have to pay any income tax on the rent you receive if:
you live in the same property as your lodger, and
the room you rent out is furnished, and
the rent you receive is not more £7,500 a year (£625 a month).
If you get more than this amount in rent, you can either pay income tax on the amount over £7,500 or pay tax on all the rent and claim tax back on any expenses involved (such as buying furniture or providing services). For further information, read the government's guidance on the Rent a Room Scheme and our guidance on Rent a room scheme and tax.
If you receive income support (IS) or jobseeker's allowance (JSA), you may receive reduced benefits if you rent out a room as you would be receiving more income than normal.
If you do intend to rent out a room, you may need to inform the relevant benefits department of your change in circumstances.
If a common-law tenant doesn’t leave at the end of the notice period, you can apply for an order from the sheriff court to get them to leave. If the tenancy is coming to an end and you have given the correct notice, or if you can prove they have broken a condition of the agreement, you will be given an automatic order.
Find out more about evicting a lodger.
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