Understanding the Different Types of Tenancy Agreements in the UK

A Guide for Landlords

Navigating the world of lettings as a landlord can be daunting—especially when it comes to choosing the right tenancy agreement. With the right information, you can safeguard your property, ensure steady rental income, and foster good landlord-tenant relationships. At Cotton Estates, we’re here to help you make informed decisions. In this article, we break down the main types of tenancy agreements in the UK, so you can choose what’s best for you and your property.

1. Assured Shorthold Tenancy (AST)

The most common type of tenancy in England and Wales, the AST is used for most private residential lets. Key features include:

• Fixed or periodic: ASTs usually start with a fixed term (typically 6 or 12 months) but can roll into a periodic (monthly) tenancy after.

• Deposit protection: Landlords must place tenants’ deposits in a government-approved scheme.

• Section 21 & Section 8: You can regain possession using either Section 21 (no fault) or Section 8 (if the tenant breaks the agreement).

• Rent: No upper limit, but if the annual rent exceeds £100,000 or is less than £250 (£1,000 in London), different rules apply.

When to use: For almost all standard private lettings, especially where the landlord isn’t living in the property.

2. Assured Tenancy

Much less common today, assured tenancies offer greater security to tenants—they can only be evicted for specific legal reasons. Most new tenancies since 1997 are ASTs, but some housing associations and historic agreements may still use assured tenancies.

When to use: Rare for private landlords. Usually found with housing associations or in rare legacy cases.

3. Regulated Tenancy

Regulated or protected tenancies pre-date 15 January 1989 and provide long-term security and rent control for tenants. These agreements are governed by the Rent Act 1977.

When to use: Not available for new lets. Only applies to tenancies that began before 1989.

4. Company Let Agreement

If you rent your property to a company, rather than an individual, the tenancy is not an AST. These agreements are called company lets and are governed by contract law, not the Housing Act 1988.

• No deposit protection requirement (but it’s still good practice)

• No Section 21/8 notices: Possession terms are set out in the contract.

• Higher risk, but potentially more stable income if renting to reputable businesses

When to use: Letting to a corporate tenant for their employee(s) or business use.

5. Non-Assured Tenancy

These arise when the agreement doesn’t meet the criteria for an AST—for example, where annual rent is below £250 (or £1,000 in London), or the landlord lives in the property but doesn’t share facilities.

When to use: Rarely used; specific circumstances only.

6. Excluded Tenancy/Licence

If you live in the property and share living space (e.g., kitchen, bathroom) with your tenant (such as a lodger), this is usually an excluded tenancy or licence.

• No deposit protection requirement

• Easier possession: You only need to give ‘reasonable notice’—no need for formal Section 21 or Section 8 notices.

When to use: Renting a room in your own home, with shared spaces.

Which Tenancy Agreement Should You Choose?

For most private landlords, the Assured Shorthold Tenancy (AST) will be the default—and for good reason. It’s legally robust, familiar to both landlords and tenants, and offers flexibility. Company lets are a specialist area and best handled with expert guidance.

The right agreement protects your interests, clarifies responsibilities, and sets the foundation for a successful tenancy. At Cotton Estates, we guide landlords through every step, making sure you’re fully compliant and confident in your lettings.

Thinking of letting your property?

Contact us for bespoke advice or to discuss the best letting option for your property.Book a call online or reach out at 0204 591 2502 / info@cottonestates.co.uk.

Useful Links:

• How Our Guaranteed Rent Works

• Guaranteed Rent vs Private Rent

• Book a Consultation

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