Rent Setting
The landlord and contract-holder should agree on the initial rent.
When considering the rent to charge, a landlord should consider what repairs and other outgoings are likely to ensure sufficient income. This needs to be balanced with current market conditions.
Written statement of contract
Where the tenancy is an occupation contract, the amount of rent (or other consideration) and the rental periods are key matters.
The written statement of the contract must clearly include the details of the rent amount and periods. If the contract is for a fixed term, the rent given in the agreement will last for the whole of the fixed term.
Receipts and rent books
A landlord should record rent payments and provide receipts for rent paid (particularly for cash payments) to avoid any later disagreements.
It's a mandatory supplementary term that occupation contracts of less than seven years must include the landlord providing a written receipt of any rent or other consideration within 14 days of a request. As the term is supplementary, it can be modified or removed with the agreement of all parties, but you must identify any modification or removal.
A landlord is legally obliged to provide a rent book for tenancies that are NOT occupation contracts, and the rent is payable weekly (failure to do so is a criminal offence). The rent book must contain certain information. You can obtain rent books from law stationers and larger general stationers. A rent book is not required for an occupation contract (section 4(4) Landlord and Tenant Act 1985).
Rent in advance
The common law position is that rent is payable in arrears unless a term in the contract expressly requires the rent to be payable in advance.
The model contracts provided under The Renting Homes (Model Written Statements of Contract) (Wales) Regulations 2022 and downloadable from the Welsh Government website do not contain a rent payable in advance term. As such, without modification, the rent is payable in arrears.
Sometimes, if references aren't satisfactory, a landlord may seek several months' rent in advance (for example, six months). As long as the contract-holder agrees, this is acceptable. However, it would be best to consider it a genuine rent in advance, and the landlord doesn't hold money.
For example, rent is due on 1 January, and the landlord asks for two months' rent in advance. The following rent will be payable on 1 March (as the two months' rent in advance covers 1 January and 1 February). Suppose the landlord was to ask for another rent on 1 February after receiving two months' rent. In that case, this "extra" amount might be deemed a deposit and require protection, leading to a breach of tenancy fees rules if a deposit has already been taken (see the tenant fees section).
If several months' rent is paid in advance, to avoid it being regarded as a tenancy deposit, the tenancy agreement should expressly state the advanced payment as a single amount and show the period it covers.
For example, if a tenancy starts on 15 January, the rent is £650 per month. Six months' rent in advance is being taken; the contract should state that rent of £3,900 (6 x £650) is payable from 15 January to 14 July and then in advance at the rate of £650 per calendar month.