Company Let

A company let is an arrangement where the tenant named on the agreement is a limited company rather than an individual. The company takes on the lease and then houses its staff, contractors, or clients in the property. The individuals who actually live there are occupiers of the company, not tenants in their own right under the agreement with the landlord.

How a company let differs from a standard tenancy

The key legal consequence is that the agreement is not an assured tenancy or assured shorthold tenancy because the Housing Act 1988 only applies where the occupier is an individual using the property as their only or main home. Since the named tenant is a company, the Renters' Rights Act protections that apply to standard residential lets, such as the abolition of no-fault evictions, Section 13 rent increase procedures, tenancy deposit caps, and prohibited payments, do not apply to the company as contractual tenant. The agreement is governed by common law and the terms of the lease itself, which can be drafted more flexibly, closer in some respects to a commercial lease than a residential one.

This does not mean landlords have no obligations. The individual occupiers are still living in the property as their home, so housing standards law continues to apply in full. The Housing Health and Safety Rating System, fitness for human habitation, Awaab's Law, local licensing, fire safety, gas safety, and electrical safety requirements all remain in force. A gas safety certificate and EICR are required just as for any let property. Local authorities and tribunals can also look through the letting chain if there are serious breaches or unlawful eviction of occupiers, including holding the superior landlord responsible.

Why landlords consider a company let

Company lets tend to attract corporate tenants, businesses relocating staff, contractors on extended projects, or employers providing accommodation as part of a remuneration package. This can mean a more financially robust counterparty than an individual tenant, potentially longer tenancy terms, and less turnover. Some landlords also find that company lets allow for higher rents and more flexible terms, particularly in locations close to business districts, airports, or large employers.

The absence of Housing Act protections also means landlords retain more contractual control. Rent reviews, break clauses, and exit terms can be negotiated more freely than under a standard AST. For landlords who have found the increasing regulation of the private rented sector constraining, this is sometimes seen as an advantage.

Risks and considerations

The flexibility of a company let comes with its own risks. Recovering possession if the company defaults or breaches the lease requires action under contract law rather than the relatively well-understood Section 21 or Section 8 routes. This can be slower and more costly. If the company becomes insolvent, the landlord's position as an unsecured creditor is weak.

Mortgage lenders are another consideration. Many standard buy-to-let mortgages do not permit company lets, or require specific consent from the lender before proceeding. Letting to a company without that consent could put the landlord in breach of their mortgage terms. Always check with your lender before agreeing a company let.

Reference checks on the company itself are essential, review the company's accounts at Companies House, check the length of trading history, and satisfy yourself that the company is solvent and has a genuine business purpose. Establish clearly who will live at the property and on what basis, and ensure the lease specifies permitted occupiers and what happens if staff change. Ensure the property meets all private rented sector rental standards regardless of the corporate structure of the tenancy.

Also read our landlord blog articles including: