Licence for Lodger to Occupy a Room in Tenant’s Property
This Licence for Lodger to Occupy a Room in Tenant’s Property should be used where a tenant is taking in a lodger.
This Licence has been updated to comply with the Tenant Fees Act 2019 (‘TFA’).
The tenant must check its tenancy agreement carefully before entering into this Licence. Many tenancy agreements prohibit tenants from taking in lodgers or require the tenant to obtain the landlord’s written consent before doing so.
The Licence gives the lodger the use of a bedroom and rights to use other parts of the house (or flat) such as the kitchen, bathroom, corridors, staircase and, optionally, the living room. The lodger is to pay a monthly Licence Fee which is stated to be inclusive of Council Tax. The lodger must also pay a fair proportion of utility bills.
Under the TFA, Licensors must only charge ‘permitted payments’ as defined by the TFA or face financial penalties (and subsequent offences could result in a criminal offence). ‘Permitted Payments’ include rent/licence fee, tenancy deposit, council tax, utilities, tv licence and default fees (for late payment of rent and replacement of a lost key/security device, where required under a tenancy agreement).
The costs of cleaning the shared areas of the house can only be charged if these costs are included in the Licence Fee. If the lodger wishes to have their own Room cleaned this should be arranged and paid for separately.
Under the TFA, Licensors cannot require a Licensee to pay for a professional clean at the end of the licence as this is a prohibited payment under the TFA. Licensors can require Licensee’s to clean to a professional standard. Under the TFA, Licensors can only charge interest for late payment if the Licence Fee is more than 14 days overdue. The rate of interest must not exceed 3% above the Bank of England’s base rate.
The licensee’s obligations are set out in clause 3 and include additional provisions in respect of fire safety.
The licence will run for a fixed term (the Licence Period) but can be brought to an end early by either party giving notice as set out in clause 4. The tenant might prefer to keep the Licence Period fairly short (e.g. a few months) and then renew the Licence if the arrangement is working well. The other option is to have a longer Licence Period and then terminate the Licence if circumstances change.
This Licence does not provide for the lodger to pay a deposit. Note that, if the tenant does take a deposit, the deposit will not need to be protected in a Tenancy Deposit Scheme. Use of such Schemes is compulsory only for deposits taken from assured shorthold tenants. However, the tenant may prefer to use a Tenancy Deposit Scheme as a matter of good practice. If the property is in England, the sum of the security deposit must not exceed the caps set by the TFA.
Optional phrases/clauses are enclosed in square brackets. These should be read carefully and selected so as to be compatible with one another. Unused options should be removed from the document.
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