Hi. I have been renting a flat for nearly 18 years with no real issues. However I recently had a new tenant move in - the tenancy didn’t qualify for rent guarantee insurance due to his referencing. I requested 4 months rent in advance which he paid. After 2 months, he announces that he wants to move out - he is still within the 4 month break clause period. So I start the process of trying to find another tenant to replace him. He then gives written notice on the 1st May (as new Renters Rights Bill had just started) and then moves out on the 26th May (within the 2 months notice).
I manage to find a new tenant who then moves in on the 30th May. The first tenants 4 months rent is advance technically runs until the 7th June, but I deem this to be non-refundable as it was rent in advance and he’s chosen to break the terms of the Break Clause period and the 2 months notice period starting on 1st May.
Am I correct in taking this position, or do I need to refund him some rent from the date he moves out (26May) until the 7th June (the end of the 4 months rent in advance)?
I think the break clause is likely unenforceable and void from 1 may due to RRA - fixed terms didn’t exist from then so a break clause about ending them early is also void- so tenant can’t have breached them.
And you can’t claim any rent from after tenancy ends, which will have been 26 may if you agreed (eg by receiving back the keys etc).
So yes you need to refund rent from 27 may to 7 June I think.
The Renters Rights Act means from 1st May if your original tenancy states 1 months notice is required to end the tenancy then the tenant only needs to give 1 month. If however your tenancy is silent on notice periods then it defaults to give 2 months. In both cases the notice will have to expire at the end of a rent period. If the rental period is the 8th to 7th of each month the tenant will owe rent up to the 7th day of the month.
You cant keep the advance rent if you have a new tenant paying rent for the same period. The old tenants liability ended as soon as that happened. If you try to argue that its more than just advance rent, it could be considered by a court to be a deposit that breaches the TFA rules and which you haven’t protected thereby making you liable for a deposit penalty of 3x the amount.
