Subletting, where a tenant lets part or all of the property to a third party, is one of the most common tenancy disputes in the private rented sector. It is also an area that the Renters' Rights Act 2025 has made more complex, particularly in relation to a tenant's right to assign the tenancy. This guide explains the legal framework, how to draft your tenancy agreement, and what to do if you discover unauthorised subletting.
Subletting: the original tenant stays on the tenancy but lets part or all of the property to a subtenant. The original tenant remains your tenant and is liable for the rent. Assignment: the original tenant transfers the whole tenancy to a new person, the new person becomes your tenant. The Renters' Rights Act 2025 significantly restricts a landlord's ability to refuse assignment.
When can a tenant sublet?
- A tenant has no automatic right to sublet, the standard position is that subletting requires the landlord's written consent
- Most well-drafted tenancy agreements prohibit subletting without consent, this is enforceable
- If the tenancy agreement is silent on subletting, the common law applies: a tenant may sublet unless the landlord's consent is required by the terms of the agreement
- A landlord can refuse consent to sublet on reasonable grounds, but unreasonably withholding consent on a commercial lease (not residential) can give the tenant a damages claim
- For residential tenancies, there is no statutory obligation to consent, you may refuse subletting and rely on the prohibition clause in your tenancy agreement
Assignment under the Renters' Rights Act 2025
The Renters' Rights Act 2025 introduces a new framework for assignment of Periodic Assured Tenancies. From 1 May 2026:
- A tenant in a Periodic Assured Tenancy may apply to assign the tenancy to a new tenant
- The landlord must not unreasonably refuse consent, the Act limits the grounds for refusal
- Permitted grounds for refusal include: the proposed assignee fails referencing, right-to-rent issues, or the landlord has served or intends to serve a Section 8 notice
- Unlike subletting (where the original tenant remains), assignment transfers the full tenancy, the original tenant's liability ends on valid assignment
- Landlords should include clear terms in the tenancy agreement addressing the assignment process, even though the statutory right cannot be entirely excluded
Unauthorised subletting, what to do
- Inspect the property at the next periodic inspection, note any evidence of additional occupants (extra beds, belongings, post addressed to unknown names)
- Check whether the additional occupant appears to be a subtenant (paying rent to the original tenant) or a permitted occupier (a family member or partner)
- Contact the tenant in writing and ask them to confirm who is living at the property and on what basis
- If unauthorised subletting is confirmed, serve a written notice requiring the tenant to end the subletting arrangement within a specified period
- If the tenant fails to comply, the unauthorised subletting is a breach of the tenancy agreement, this supports a Section 8 notice on Ground 12 (breach of tenancy obligation)
- Do not attempt to evict the subtenant directly, the subtenant may have rights against you if the tenancy agreement is illegal (e.g. if the property is used as an unlicensed HMO)
Subletting and HMO licensing
If a tenant sublets part of the property, the additional occupant counts towards the HMO occupation threshold. A property let to 3 people from 2 households that accepts a subtenant could become a licensable HMO (5 people from 3 households) without the landlord's knowledge. Always check whether subletting or an additional occupant would push the property into mandatory or additional HMO licensing territory.
- If subletting pushes the property above the HMO threshold, you must apply for an HMO licence immediately
- Operating an unlicensed HMO is a criminal offence, unlimited fine, rent repayment order, banning order
- Your buildings and contents insurance may be void if the property is occupied differently from the declared use
- Your mortgage (if a buy-to-let mortgage) may prohibit any change in occupancy without lender consent
Drafting to prevent unauthorised subletting
- Include a clear prohibition on subletting and assignment without prior written consent from the landlord
- Define 'occupier' and 'subtenant' in the tenancy agreement to close definitional gaps
- Include a clause requiring the tenant to notify the landlord in writing of any proposed change in occupation within a specified period (e.g. 7 days)
- Include an inspection clause allowing periodic inspections with appropriate notice (minimum 24 hours), inspections are the most reliable way to detect unauthorised occupants
- Specify that breach of the no-subletting clause is grounds for possession under Section 8 Ground 12 (breach of tenancy obligation)