Search

How can we help?

Icon

What happens when a business tenant remains in occupation after the expiry of its lease?

Difficulties can arise when a business tenant remains in occupation of a property when its right to do so has come to an end. This may be because the tenant has a lease that does not carry security of tenure under the Landlord and Tenant Act 1954 (“the Act”) and the lease has expired. Alternatively the lease may be protected by the Act, but, following service by the landlord or tenant of notices under section 25 or section 26 of the Act, the tenant has not taken any steps to issue a claim for a new lease or extend time for doing so.

Often when a tenant remains in occupation it is because negotiations for a new lease are ongoing, and usually in this case the tenant will have a tenancy at will – a type of unprotected tenancy which can be ended at any time.

However, there is a risk that, if the situation is not resolved promptly, the parties can find themselves with an implied periodic tenancy. The legal status of the tenant will always depend on the specific circumstances of each case, but the key factors the courts will look at are whether rent is being paid and accepted, and whether the parties are actively engaged in negotiations for a new lease.

Often when a tenant remains in occupation it is because negotiations for a new lease are ongoing.

It is often landlords who will want to avoid a periodic tenancy arising, as any such tenancy will be protected by the Act (even if the expired lease was itself outside the Act). This means that the tenant will have security of tenure, and the landlord’s ability to terminate the lease will be significantly restricted. Sometimes, though, an implied periodic tenancy could disadvantage the tenant, if the tenant in fact decides that it no longer wants a new tenancy and wants to vacate the premises – the tenant may find itself liable for rent and service charges for a lengthy notice period.

Given the uncertainty in this area and the risks for both landlords and tenants if a periodic tenancy arises, parties should not allow the situation to drift after the expiry of a lease or section 25/section 26 notice. Landlords should ensure that they do not demand or accept rent, and should consider putting written tenancies at will in place if negotiations for a new lease are ongoing. If negotiations stall, immediate action should be taken to regain possession of the premises.

If you have any queries on any of these points please contact our landlord and tenant solicitors.

Disclaimer
This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full General Notices on our website.

Author profile

About this article

Read, listen and watch our latest insights

art
  • 25 September 2026
  • Employment

Consultation response on duty to inform workers of right to join a union

From 30 October 2026, the Employment Rights Act 2025, makes it a requirement for employers to inform workers of their right to join a trade union at the same time as the Section 1 particulars are issued to them and at subsequent times. The details of this new duty are to be provided in regulations.

art
  • 24 September 2026
  • Public Procurement

Procurement challenges: What documents and information are bidders entitled to?

A tricky feature of public procurement challenges for unsuccessful bidders is that contracting authorities usually hold all the cards. When the outcome of a tender conducted under the Procurement Act 2023 has been decided, authorities must provide bidders with an Assessment Summary containing their scores for each of the award criteria and those of the successful bidder and an explanation for those scores.

art
  • 23 September 2026
  • Corporate and M&A

GDPR Privacy Policies: Key requirements for organisations

When an organisation is creating a website or app to reach users or potential customers drafting a Privacy Policy may be an afterthought. However, failure to write a Privacy Policy, which complies with the relevant legislation, can have serious consequences.

Pub
  • 17 September 2026
  • Employment

Employment law changes in 2026: What you need to know

Stay ahead of the latest UK employment law changes. Watch our on demand webinar with Monica Atwal and Harry Berryman covering key HR developments and employment law updates for 2026.

art
  • 16 September 2026
  • Employment

Received an Employment Tribunal Claim? 6 Things Employers Should NOT Do

We are well and truly underway with implementation of the Employment Rights Act 2025 (“ERA 2025”) and October brings the next tranche of changes that employers will need to be ready for.

art
  • 14 September 2026
  • Corporate and M&A

Key provisions found in a Shareholders’ Agreement – SHA Series Part 2 of 5

Discover the key provisions in a shareholders’ agreement, including ownership, decision-making, share transfers, exits and leaver clauses.