Landlords – Before signing a tenancy, learn the facts about ‘Permitted Occupiers’
A permitted occupier is generally referred to as ‘a person that is not a tenant but has permission to stay in a rented property’. They have no legal rights to the property nor are they required to pay rent to the landlord. It is expected that the permitted occupier treats the property with care, but the tenant is ultimately responsible for them.
In this article, you can find out everything you need to know about the rules of permitted occupiers, including the rights they have, what a tenancy agreement must include and what happens when the tenant leaves to property.
Who can be a permitted occupier?
Simply put, they can be anyone. Some examples are:
- A partner of a tenant who stays on a regular basis
- A child of a tenant who lives at university and returns home during the holidays
- An older relative of the tenant who must be cared for
Why do landlords include permitted occupier clauses?
Some landlords prefer to include a permitted occupier clause in their tenancy agreement to make a record of the occupier’s presence at the property. As someone who will be living in the property from time to time, it’s to best to have their details and the landlord’s permission clearly set out in writing.
A set clause within the agreement will reiterate the tenant’s responsibility for them and may be helpful to the landlord if any disputes arise that involve the permitted occupier.
Permitted occupiers and HMOs
A landlord may also want to include a permitted occupier clause to comply with HMO licensing regulations and ensure that the property doesn’t become an HMO without the landlord’s knowledge.
According to the regulations, a property is likely to be an HMO if:
- There are 3 or more people living the property who form two or more households
- They share common facilities such as a kitchen and bathroom
Landlords must comply with certain requirements where the property is an HMO, but not all HMOs need to be licensed. A licence is mandatory if:
- The property is rented to five or more people who form more than one household
- Tenant share common facilities such as kitchen and bathroom
Landlords may also require a licence for an HMO if the property is located in an area where the local authority has introduced an additional licensing scheme. In these areas, all rented properties will need a licence even if they are not licensable HMOs.
As the HMO regulations apply to ‘people’ living in the property, the number of permitted occupiers living in a property includes children – not just adults.
Why would someone want to be a permitted occupier?
A main reason for a person wanting to be listed as a permitted occupier is so that they have evidence of a permanent address.
For many things in day-to-day life, such as getting a job, financing a car, taking out a phone contract and registering to vote, we are required to show that we have a permanent place of residence in the UK.
If, for instance, a person moves into their partner’s rented property and gets a new job nearby, their employer may ask for a proof of address. Without being listed as a permitted occupier, the person would be unable to evidence that they live at the property as it is their partner who’s the tenant on the agreement – not them.
How do I add a clause to my tenancy agreement?
If a tenant requests a permitted occupier before the tenancy agreement is drafted and signed, a clause should be added to the agreement (if there isn’t one already) and the person’s name should be listed.
If a tenant, asks permission after the agreement has been signed, the original agreement can be amended to include a permitted occupier clause with the person’s name listed.
Who pays for the amendment of the agreement?
Amending a tenancy agreement to include an additional clause is one of the few things that a tenant can be charged for. Since the Tenant Fee Ban began on 1 June 2019, tenants can no longer be asked to pay lettings fees and deposits are capped at five week’s rent.
However, as a tenant requests that a permitted occupier be added to their agreement, it is the tenant, not the landlord, that is entitled to pay the amendment fee.
Does a permitted occupier have to be referenced?
No. A permitted occupier does not need to be referenced. They are technically an extension of the tenant; they are the tenant’s responsibility and it’s the tenant who will be paying the rent.
How are they different to a lodger?
The main difference between a lodger and a permitted occupier is that a lodger will pay rent.
If you own a property, you can take in a lodger to live with you and pay rent. The government Rent a Room scheme allows homeowners to take in a lodger and earn up to £7,500 tax-free per year.
If you are a tenant, you will need your landlord’s permission before taking in a lodger. Your tenancy agreement may allow you to have a lodger, allow it in certain circumstances or ban it altogether. Whatever the case, you must not take on a lodger without your landlord knowing.
What rights do permitted occupiers have?
Permitted occupiers have no legal rights to the property. The clause in the tenancy agreement acknowledges that they live there, but that is all.
It’s important for landlords and tenants to remember that whilst the tenant is responsible for the permitted occupier, it does not work the other way around. The permitted occupier can not account for the tenant and does not take on any of their rights or responsibilities if the tenant moves out.
Can they stay if the tenant leaves?
If a tenancy comes to an end and the tenant moves out, the permitted occupier must leave too. As they have no legal rights to the property and are technically the responsibility of the tenant, they are not entitled to stay.
If a tenant gives notice, moves out and a permitted occupier refuses to leave, the tenant is still liable for rent as they have not left the property in vacant possession.
It’s also important for landlord’s remember that they must not demand any rent from the permitted occupier, even if the tenancy has ended and they are refusing to leave. Demanding and accepting a form of rent from the them may be argued as granting them tenancy and could be perceived by law as giving them the rights of a tenant.