Corporate Lets: How they Work and What to Consider
This article explores corporate lets from a landlord perspective: how company tenancies work, the legal framework and what to consider before proceeding.
08/07/2026By Sunil Chander · Co-Founder
This article explores corporate lets from a landlord perspective: how company tenancies work, the legal framework and what to consider before proceeding.
For landlords looking beyond the standard rolling or periodic tenancy, corporate lets represent an alternative model with its own advantages, obligations and risks. The term is sometimes conflated with serviced accommodation, but the two are distinct arrangements. A corporate let is an agreement between a landlord and a company, where the business takes on the tenancy and houses its employees in the property. The landlord's legal relationship is entirely with the company, not with the occupant of the property.
What a corporate let actually is
In a corporate let, a business entity signs the tenancy agreement and takes on the obligations that would ordinarily fall to an individual tenant. The company pays the rent, handles utility bills and council tax, and is liable for the condition of the property. The employee occupies the property as a licensee of the company, not as a tenant in their own right.
Typically, companies use these arrangements to house employees who are relocating, working on a fixed-term project or being placed in a city where the business has a temporary or ongoing operational need. Demand is strongest in major urban centres, but the corporate letting market is active across the country and spans a wide range of property types.
The legal framework and why a standard rolling or periodic tenancy will not work
The most critical thing a landlord must understand before entering a corporate let is that a standard rolling or periodic tenancy is not valid for a company tenant. The Housing Act 1988 specifically excludes corporate entities from its provisions, which means the statutory framework landlords are accustomed to under a standard rolling or periodic tenancy, including Section 8 notices (subject to the Renters' Rights Act 2025), and the requirement to protect deposits in a government-approved scheme, does not apply.
Instead, a corporate let operates under a Common Law Tenancy, a bespoke contractual arrangement shaped almost entirely by what the agreement itself contains. A common law tenancy falls outside the statutory regime and is governed by the common law of contract. To end the tenancy, the landlord must serve a formal Notice to Quit on terms clearly set out in the agreement. If the company refuses to vacate, the landlord must still obtain a court order under the Protection from Eviction Act 1977, though the process is generally more straightforward than under Section 8 (subject to the Renters' Rights Act 2025).
The corporate tenancy agreement should be drafted by a solicitor experienced in property law. Template agreements downloaded online have been known to be rejected by mortgage lenders as legally deficient. The National Residential Landlords Association ("NRLA") also offers a Company Let Agreement developed with appropriate legal input, which provides a reliable starting point.
Council tax and utility responsibilities
Council tax corporate let responsibility sits with the company as the named tenant, not the individual occupant or the landlord. This must be explicitly confirmed within the tenancy agreement rather than assumed. The same applies to utility bills. In a well-structured corporate let, the company takes on all running costs, reducing the administrative burden on the landlord. These responsibilities should be clearly documented and never left to assumption.
Insurer rules for company lets
Landlords must notify their insurer before entering a corporate let. Standard buy-to-let insurance policies are written with an individual tenant in mind and switching to a corporate tenancy without informing the insurer can invalidate cover entirely. Insurer rules for company lets vary between providers and some will require a policy amendment or a separate product.
The key areas to clarify are malicious damage cover, liability for damage caused by a licensee, and whether the policy accommodates the higher turnover of occupants that can characterise company lets. These details must be confirmed before the tenancy begins, not at the point of making a claim.
The financial case for corporate lets
The financial appeal is well established. Market data suggests corporate lets can command rents 15 to 20% higher than comparable open-market properties, reflecting the premium businesses are prepared to pay for good quality and well-located accommodation. Companies will often seek agreements of up to three years, providing income stability and reducing void periods from a landlord perspective.
Rent is paid by the business rather than an individual, which generally means more reliable payments. The property will need to be furnished to a high standard, as corporate tenants expect accommodation that is ready to move into. However, that upfront cost is typically offset by the premium rent and the lower likelihood of damage from professional occupants.
Corporate letting risks landlords should understand
Corporate letting risks deserve careful consideration. The most significant is the reduced statutory protection that comes with operating outside the Housing Act framework. Because the corporate tenancy agreement is the landlord's primary defence if things go wrong, a poorly drafted agreement leaves limited recourse.
A second risk is reduced visibility over who occupies the property, as the company decides which employee lives there without the landlord's direct input. Insisting on regular inspections within the agreement and maintaining open communication with the company's point of contact helps to manage this.
Furthermore, break clauses are common in corporate tenancy agreements, typically inserted at the company's request to allow early exit if circumstances change. Negotiating the notice period and conditions carefully is important to protect cash flow.
Thorough due diligence on the company before signing is essential. Checking registration and financial filings via Companies House is a basic but necessary step. For smaller or newer businesses, requesting a director's personal guarantee provides meaningful additional security, converting any corporate debt into a personal liability should the company become insolvent during the tenancy.
The Renters' Rights Act and corporate lets
The Renters' Rights Act, which became law in October 2025 and is being implemented in phases from May 2026, introduces significant changes to the previous assured shorthold tenancy framework, including the abolition of fixed-term tenancies and Section 21 evictions. These changes do not apply to company lets.
Conclusion
Corporate lets offer a compelling proposition for landlords prepared to understand the legal framework, invest in a properly drafted agreement and manage the arrangement with appropriate rigour. Higher rents, longer tenancy terms and reliable payment from a business entity are genuine attractions. But the absence of statutory protections that underpin a periodic or rolling tenancy means the quality of the corporate tenancy agreement and due diligence on the company tenant are not optional. They are the foundation on which the entire arrangement rests.
FAQs
Q. What is the difference between a corporate let and a standard periodic or rolling tenancy?
A. In a standard periodic or rolling tenancy, the tenant is an individual governed by the Housing Act 1988 and Renters' Rights Act 2025. In a corporate let, the tenant is a company, placing the agreement outside the Housing Act and Renters' Rights Act entirely. Statutory processes such as Section 8 notices and government-backed deposit protection do not apply.
Q. Do I need a special corporate tenancy agreement?
A. Yes, the agreement must be a bespoke Common Law Tenancy, ideally drafted by a solicitor with property law experience. The NRLA also offers a Company Let Agreement developed with appropriate legal input as a reliable alternative.
Q. Who is responsible for council tax in a corporate let?
A. Council tax responsibility sits with the company as the named tenant, not the individual occupant or the landlord. This should be explicitly confirmed within the tenancy agreement alongside responsibility for utility bills and other running costs.
Q. Do I need to tell my insurer about a corporate let?
A. Yes, insurer rules for company lets vary, and a standard buy-to-let policy written for a periodic or rolling tenancy may not extend to a corporate arrangement. Failing to notify your insurer before the tenancy begins could invalidate your cover entirely.
Q. Do corporate lets typically achieve higher rents?
A. Generally, yes. Market data suggests corporate lets can command rents 15 to 20% above comparable open-market properties, reflecting the premium corporate tenants are prepared to pay for good quality, well-located and well-furnished accommodation.
Q. What are the main corporate letting risks?
A. The principal risks include reduced statutory protection if the agreement is poorly drafted, limited visibility over who occupies the property, break clauses that can disrupt cash flow and financial exposure if the company becomes insolvent. Due diligence, a director's personal guarantee and inspection rights written into the agreement are key mitigants.
Q. Does the Renters' Rights Act affect corporate lets?
A. The Renters' Rights Act applies to assured tenancies, which corporate lets are not. The reforms it introduces, including the abolition of fixed-term tenancies and Section 21 evictions, do not apply to company let arrangements.
Q. Do I need to protect the deposit in a government-backed scheme?
A. No. The legal requirement to use a government-approved deposit protection scheme applies only to periodic or rolling tenancies. For corporate lets, landlords should still take a deposit, hold it in a separate designated account and clearly set out the terms for deductions within the tenancy agreement.
Q. What due diligence should I carry out on a corporate tenant?
A. Verify the company's registration and financial standing via Companies House, confirm it is actively trading and review any filed accounts. For smaller or newer businesses, a director's personal guarantee provides meaningful additional security.
Q. Will my existing buy-to-let mortgage allow a corporate let?
A. Not automatically. Some buy-to-let products permit corporate lets, but many standard products do not and proceeding without lender consent can breach your mortgage terms. Check your conditions and obtain written confirmation from your lender if necessary before entering into any corporate let arrangement.
About the author
Sunil Chander
Co-Founder
Sunil oversees operations and compliance at Pauzible, drawing on his extensive experience as the founder and CEO of Dawnbud Limited, a financial services consulting firm. His prior career included senior roles in investment banking at Smith New Court and NatWest. He holds an MBA from LBS, M Litt from Oxford and a PhD from Cambridge.
corporate letscompany tenancycommon law tenancylettingslandlords
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