A licence to sublet is an agreement between a landlord and tenant giving the tenant the right to sublet the whole or part of the property to another party (known as the subtenant). As a landlord of... ... Read more
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How to Make a Licence to Sublet
A licence to sublet is an agreement between a landlord and tenant giving the tenant the right to sublet the whole or part of the property to another party (known as the subtenant).
As a landlord of a commercial property, you may decide to grant your tenant a sublease at their request. Use this straightforward subletting contract to formally give them your consent to sublet. This sublet agreement will make sure everything is properly done and contains the usual covenants so that the tenant and landlord are adequately protected.
For use in England and Wales only.
Use this licence to sublet:
This licence to sublet covers:
providing a commercial tenant with consent to sublet
a requirement that the subtenant won’t have security of tenure
a notification of the completion of the sublease assignment
the landlord's registration fee
If the lease absolutely prohibits subletting then the landlord can refuse consent without giving a reason. If it prevents subletting without the landlord's consent the landlord must have a good reason for refusing. Refusal is likely to be justified only if the subtenant:
cannot show that it has the financial strength to pay the rent and other sums under the sublease or to meet the cost of repairs and other obligations, or
intends to use the property for a purpose not allowed by the lease (eg using a shop as a fast food outlet or restaurant).
If the lease absolutely prohibits subletting then the landlord can refuse consent without giving a reason. If it prevents subletting without the landlord's consent the landlord must have a good reason for refusing. Refusal is likely to be justified only if the subtenant:
cannot show that it has the financial strength to pay the rent and other sums under the sublease or to meet the cost of repairs and other obligations, or
intends to use the property for a purpose not allowed by the lease (eg using a shop as a fast food outlet or restaurant).
The landlord can set a time limit within which the sublease must be granted and is entitled to insist that the sublease is completed within a reasonable period after the date of references of the subtenant were provided. If a sublease hasn't been completed within the agreed time period the tenant will no longer have permission to grant a sublease and the tenant will need to re-apply for permission.
A landlord should insist that the subtenant joins in the licence to sublet so that the landlord can claim against the subtenant if there is any breach of its obligations under the sublease.
A landlord can charge a fee to cover its administration costs for updating records and management systems as to who is in the property. Fees of £25 or £50 are common.
Last reviewed or updated 17/06/2022
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