Landlord Law Essentials

Landlord Law Essentials Part 7 - Rent

This is fairly fundamental to all tenancies.

In fact, the occupation of property is not really a tenancy without it, and it is the main reason (along with capital growth) why landlords invest in property and rent it out to tenants. So lets take a look at the rules about rent.

Introduction
Protected Shortholds
Assured Shorthold Tenancies
Rent
Recovering Possession
Obtaining a Court Order
The Future

A few facts about Rent

Here are a few facts to start with that you may not be aware of:

The default position is that rent is payable in arrears. The reason most rent nowadays is payable in advance is because this is required by the tenancy agreement. So that is another compelling reason to have a tenancy agreement! *
Rent is due on the morning of the rent day given in the tenancy agreement (or as agreed if there is no tenancy agreement) but is not overdue until after midnight of that day.
If rent is paid weekly, then you must give the tenant a rent book. However, if you don’t do this, it doesn’t mean your tenant can withhold rent. You can be prosecuted though.
However, tenants DO have the right to withhold rent if you fail to give an address in England or Wales for the service of notices. This is a requirement under s48 of the Landlord and Tenant Act 1987 and rent is not ‘due’ until you have complied. Just having an address for the landlord in the tenancy agreement (provided it is in England or Wales) will satisfy the requirement. If you have failed to comply, all the back rent will fall due once you serve the notice. So, you will not, long term, lose any money. However, quite a few landlords have lost possession claims based on rent arrears due to this rule. The address does not have to be your home address. So, if you live in Scotland or Argentina, your letting agents address in, say, London, will suffice.
Rent demands also need to have the name & address of the landlord (s47 of the Landlord & Tenant Act 1987) as well as (if you are not resident in England or Wales) the address for the service of documents as in s48 – although this is not critical as payment of rent is not dependent on a demand being made.

* Note that this (i.e. rent being payable in arrears by default) is a common law rule, so I can’t point you at any specific act of Parliament. See the blog post in the further reading section on this.

So that’s a few facts for you. But let’s take a look now at the big rent topics.

Note that the points discussed below will only apply to assured / assured shorthold tenancies. Different rules apply to Rent Act protected tenants and tenants with a common law tenancy.

Rent in advance

It has been common for many years for landlords to take up-front payments of rent where the ability of the tenant to pay is in question. This includes:

Students
Overseas tenants (who do not have a credit history in this country), and
Applicants with a poor financial record

However, this will no longer be possible after 1 May 2026 under new rules being brought in by the Renters Rights Act 2026.

The rules about rent in advance are complex and it is best to discuss them in three stages:

Before the tenancy agreement is signed. After 1 May 2026, there will be an absolute prohibition on taking any rent in advance. Non-compliance is punishable by a Civil Penalty fine of up to £5,000. Members can find out more here.
Between signing and the tenancy start. Landlords can take up to one month’s worth of rent only.
During the tenancy. Landlords can require rent to be paid at the start of a rental period, but cannot require it to be paid earlier. So they cannot (for example) require February’s rent to be paid in January, although (if the rental period starts on the first day of the month) they can require February’s rent to be paid on 1 February. However, if the tenants want to pay rent in advance, they can.

These rules apply equally to landlords and agents. Note that during the tenancy, tenants can pay rent in advance if they want to, but landlords/agents cannot require this.

The prohibition on rent in advance will impact particularly on student landlords. Find out more about this here.

The Proposed Rent in Advertisements

As mentioned in Part 4, when advertising a property to let, landlords and their agents must give a proposed rent. This

Must be the same in all adverts
Cannot be increased (this is to prevent rental bidding pushing the rents up to unaffordable levels), although
You can agree a lower rent with tenants

Landlords may be tempted to give a very high proposed rent. Note however, that this may backfire as tenants will be entitled to challenge this to the First Tier Tribunal during the first six months of the tenancy.

This right is available pre 1 May 2026 for assured tenants, but very few use it due to the fear of incurring a section 21 eviction later on. Also, the First Tier Tribunal can, pre 1 May 2026, put rents up as well as down. After 1 May, they will only be able to reduce them.

The setting of the proposed rent therefore, is an important consideration. Probably the best people to deal with this are letting agents who will have a better knowledge of local rents.

Note that breaching the proposed rent rules after 1 May 2026 will make landlords and agents liable for a Civil Penalty fine of up to £7,000. Members can find out more about this here.

How to increase rent

It’s very important that you increase rent in the proper way. If you don’t, the rent increase won’t be effective, and your tenant will not have to pay it.

If you then go on to issue proceedings based on the shortfall, you will lose and may even be ordered to pay your tenant’s legal costs.

Prior to 1 May 2026 there are three ways rent can be increased:

By agreement
By the statutory notice procedure and
By a rent review clause in the tenancy agreement.

Of these three, the most common is ‘by agreement’, which is then confirmed by the tenant signing a new tenancy agreement or renewal form.

However, the Renters Rights Act 2025, due to come into force in this respect on 1 May 2026 will change this.

Increasing rent after 1 May 2026

This can ONLY be by way of the statutory notice procedure. Here are the main points:

Attempting to increase rent without serving a section 13 notice first will be invalid. So all tenancy agreement rent review clauses will become unenforceable
Landlords will be able to agree a new rent with tenants, but ONLY after the section 13 notice has been served first. The agreed rent cannot be more than the section 13 figure
There will be a new form published for this, Form 4A. The old form 4 should not be used after 1 May 2026
Rent increases can only be done once every 12 months
The notice period will increase from 1 to 2 months
Tenants can refer the proposed rent to the First Tier Tribunal for review during the two-month notice period
The First Tier Tribunal can only bring the rent down, they can no longer increase it
Where a rent is challenged, the rent decided upon by the Tribunal will be payable from the date of determination or (if the Tribunal consider the rent increase will cause tenants hardship) up to two months later.

Landlord Law members can find out more about this in the FAQ here.

Landlords are advised to keep a record of service of their Form 4A/section 13 notice in case this is challenged later.

Rent arrears

This is every landlord’s nightmare! If your tenant suddenly stops paying – what do you do?

My advice, first, is that you must put in place systems so that you will find out immediately if your tenant fails to pay. For example, many of the new financial apps will do this. Or you can just log into your bank account and check every month.

Once you learn that your tenants have missed a rental payment, you should contact them immediately, asking them (nicely) why. Sometimes it may just be a mistake, and your tenant will thank you for letting them know.

However, at other times, it will be the start of a long, difficult period which may end in having to evict your tenant.

Try to help tenants to pay

Before aggressively threatening legal proceedings, you may want to see if you can help your tenants to pay. Here are some suggestions:

Change the date that rent is paid and set up a new standing order (or other arrangement).

Sometimes it will help your tenants if the rent is paid the day after their salary is paid – as there will be less scope of them to spend it on something else!

You don’t need to amend the tenancy agreement to do this, a simple letter is normally all that is required. We have one for Landlord Law members in our Rent Arrears Action Plan section.

Help your tenants apply for or check their benefit

Some tenants may find the bureaucracy involved in this daunting and will welcome assistance. There is a website where you can check whether the tenants are getting all that they are entitled to. Tenants are sometimes unaware that they are entitled to benefits, for example, if they are working in low-paid employment.

Check the Local Authority.

Your tenants may be entitled to a Discretionary Housing Payment or other grant aid.

See if they are eligible for grant aid.

For example, if they are having problems paying their utility bills, check out their utility website to see what help is available.

For other grant aid, Turn2Us is a very useful site where you can search for grants that your tenants may be entitled to – for example, because of their job or profession, having children, nationality, etc. You can also search the register at the Charities Commission.

There are thousands of organisations which may be willing to give grants to tenants in need so this is well worth trying.

Agree to a payment plan for the outstanding rent.

This will normally be that the tenant pay the current rent plus an extra payment to reduce the arrears. We have draft letters for our members on Landlord Law.

Help the tenant to set up a ‘jam jar’ account.

These are particularly useful for tenants on benefit. Credit Unions sometimes offer this service.

The tenant’s benefit or salary is paid into a special account, which will then make payments out to you for your rent and to any other regular creditors and then pay the balance to the tenant’s bank account. This can dramatically reduce rent arrears and indeed is recommended for all tenants on benefit. However, it looks as if fewer credit unions offer this service than formerly.

Landlord Law members can find out more in our article Helping Tenants in Arrears of Rent.

Eviction should be your last option

Eviction is expensive, time-consuming (it can take up to a year or more), and tenants often stop paying if they know they are being evicted.

So you will often end up with a massive arrears bill, plus you will need to find new tenants.

In some situations, you will have no option. For example, often tenants will be told by their Local Authority that they cannot rehouse them if they move out, and the tenants are told to remain in the property until a possession order is made.

Local Authorities are not supposed to do this, but they often do – mainly because they have few or no properties available to rehouse tenants.

A classic sign of this is when tenants just refuse to speak to you.

In this case, the best thing to do is just to proceed with a claim for possession as soon as possible. We will be discussing eviction later in the series.

And finally

The most important thing in a rent arrears situation is to do something and not let things drift. I have known situations where landlords have allowed the rent arrears to reach horrendous proportions before they take action.

Don’t fall into the trap of putting off action because your tenants promise to pay. It is easy to promise payment, less easy to do it!

Tell your tenants you expect them to make at least some payment first and that THEN you will hold off, or consider holding off taking action.

Many tenants have effectively been able to negotiate additional free accommodation for themselves and their families by promising to pay landlords and then failing to do as they promised.

I have written quite a bit about rent arrears and rent problems on the blog and you will find links to several of these posts below.