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Licence to Occupy

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Great interaction. I had a simple question which would have cost a fortune going to see a local solicitor. It was all very professional but still friendly. The solicitor I spoke to was the chief executive of her law firm (I looked her up on LinkedIn). You are dealing with very good lawyers who earn additional money through Lawhive. I would definitely use this service again. Highly recommend.
Mark,
29 December, 23
The solicitor who was appointed to me was outstanding
Very simple to engage with instant confirmation in writing straight after. Daniel, the solicitor who was appointed to me, was outstanding in his approach, his understanding of the technicalities of the law and, crucially, a genuine care for the client. Would definitely advise using Lawhive, you won't regret it.
Tahir Idris,
04 October, 23
We were so pleased to find the Lawhive website
After struggling to find a solicitor willing to give us advice, and for a reasonable cost, we were so pleased to find the Lawhive website. At first we wondered how well it would work, but needn't have worried at all - the whole process was simple, straightforward and professional and great value for money. We felt extremely lucky to be matched with our solicitor, Sonay Erten, as she was exactly what we were looking for - knowledgeable, patient and kind - a refreshing change from solicitors we have used in the past. She showed a great deal of empathy for our situation and explained things in language that was easy to understand (rather than the usual "solicitor" talk, which can be intimidating). She's a shining example of what a solicitor should aspire to be and I wouldn't hesitate to recommend her to others or use her again in the future. We came out of our session reassured and confident of what we needed to do going forward, so a big "thank you!"
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01 June, 23
Fast and professional
I got the outcome I wanted regarding cease and desist to a competitor spreading defamatory statements about my business. Fast and professional, and at a much lower price than high street firms. Highly recommended thanks.
Jason Hunter,
23 July, 23
Very efficient! Can highly recommend.
I found the website very easy to use. Quick responses and I was even able to talk to someone who was friendly and competent. She rang me rather than emailed me. A solicitor was quickly found who could help me and once the relevant identification was approved he started work. Within two days the solicitor had checked documents and commented on them. Very efficient! Can highly recommend.
Pauline Piper,
15 February, 23
The service was fast and ultra professional
Sonay was really informative and understood my questions instantly, what I thought was complex Sonay simplified massively. She regularly checked in and the service was fast and ultra professional. Would highly recommend.
Jamie Crichton,
09 November, 23
Great service and very reasonably priced,
Great service and very reasonably priced, Kem was really helpful and professional. Would use again
Sarah Shanks,
21 November, 23
Great Interaction
Great interaction. I had a simple question which would have cost a fortune going to see a local solicitor. It was all very professional but still friendly. The solicitor I spoke to was the chief executive of her law firm (I looked her up on LinkedIn). You are dealing with very good lawyers who earn additional money through Lawhive. I would definitely use this service again. Highly recommend.
Mark,
29 December, 23
The solicitor who was appointed to me was outstanding
Very simple to engage with instant confirmation in writing straight after. Daniel, the solicitor who was appointed to me, was outstanding in his approach, his understanding of the technicalities of the law and, crucially, a genuine care for the client. Would definitely advise using Lawhive, you won't regret it.
Tahir Idris,
04 October, 23
We were so pleased to find the Lawhive website
After struggling to find a solicitor willing to give us advice, and for a reasonable cost, we were so pleased to find the Lawhive website. At first we wondered how well it would work, but needn't have worried at all - the whole process was simple, straightforward and professional and great value for money. We felt extremely lucky to be matched with our solicitor, Sonay Erten, as she was exactly what we were looking for - knowledgeable, patient and kind - a refreshing change from solicitors we have used in the past. She showed a great deal of empathy for our situation and explained things in language that was easy to understand (rather than the usual "solicitor" talk, which can be intimidating). She's a shining example of what a solicitor should aspire to be and I wouldn't hesitate to recommend her to others or use her again in the future. We came out of our session reassured and confident of what we needed to do going forward, so a big "thank you!"
Julie Taylor,
01 June, 23
Fast and professional
I got the outcome I wanted regarding cease and desist to a competitor spreading defamatory statements about my business. Fast and professional, and at a much lower price than high street firms. Highly recommended thanks.
Jason Hunter,
23 July, 23
Very efficient! Can highly recommend.
I found the website very easy to use. Quick responses and I was even able to talk to someone who was friendly and competent. She rang me rather than emailed me. A solicitor was quickly found who could help me and once the relevant identification was approved he started work. Within two days the solicitor had checked documents and commented on them. Very efficient! Can highly recommend.
Pauline Piper,
15 February, 23
The service was fast and ultra professional
Sonay was really informative and understood my questions instantly, what I thought was complex Sonay simplified massively. She regularly checked in and the service was fast and ultra professional. Would highly recommend.
Jamie Crichton,
09 November, 23
Great service and very reasonably priced,
Great service and very reasonably priced, Kem was really helpful and professional. Would use again
Sarah Shanks,
21 November, 23
Rated 4.8 / 5. Showing our 4 & 5 star reviews.

About

A Licence to Occupy is a legal document that allows a person to occupy a property for a specified period of time. It is often used in the case of a leasehold property, where the leaseholder has a licence to occupy the property for the duration of the lease.Next steps

How much does a Licence to Occupy cost?

The cost for a licensed solicitor to help with a Licence to Occupy is dependent on many factors including the complexity and specific requirements of the case. On average it is expected to range from £250-£300 but in some cases it could cost as much as £500.

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Licence To Occupy Solicitors

Need a place to do business and have no time to waste? Perhaps you have orders to fill or lenders and investors breathing down your neck? Or you simply need a location to set up a shopfront.

A licence to occupy could be the solution you’ve been searching for that’ll allow you to start doing business and getting orders and sales through the door.

licence-to-occupy

Our network of solicitors is ready to assist you with license to occupy agreements when your business is looking for a short-term property solution as a stopgap while you look to secure longer-term property accommodation.

Get in touch with our Legal Assessment Team for a free case evaluation and quote today.

What is a licence to occupy?

A licence to occupy is a legal agreement between a property owner (licensor) and an occupier (licensee) that gives the occupier the right to occupy a building for a specified purpose, but not exclusive possession or interest in the land. 

The agreements are personal to the parties and the owner of the building can revoke the licence if they choose.

There are two types of licence to occupy, a bare licence and a contractual licence.

What is a bare licence?

Under a bare licence, the licensee is allowed to use the licensor’s property via a verbal agreement. It’s the simplest form of licence granted by a landowner to an individual to access and use their land. 

It does not grant the licensee any interest in the land or change the ownership in any way.

A bare licence does not require the licensee to remunerate the landowner.

By granting a bare licence the landowner protects the person using the land from being accused of trespass. As long as the licensee follows the terms of the bare licence they are legally protected from trespass charges.

A bare licence may also be implied when a landowner is aware of trespass on their land but does nothing about it.

What is a contractual licence to occupy?

A contractual licence to occupy differs from a bare licence in that it is operated as a contractual agreement. Additionally, unlike a bare licence, the occupier of a licence to occupy pays for the privilege.

Similar to a bare licence, but unlike a tenancy, this form of licence does not grant the occupier exclusive possession rights.

In a nutshell, a contractual licence to occupy is a short-term contract where the occupier pays rent, but does not have the same rights and protection as a tenant.

What is the difference between a licence to occupy and a tenancy agreement?

A tenancy agreement unlike a licence to occupy gives the occupier, or tenant in this case, exclusive possession of a property. Under a licence to occupy the landowner has the right to use the land and property at the same time as the occupier if they choose.

Typically, tenants have exclusive possession of a property unless they have a live-in landlord. When a tenant lives with a resident landlord this must be at the landlord’s permanent residence.

Tenants have more responsibilities and are also granted greater rights than occupiers under a licence to occupy. 

Their responsibilities include paying rent in full and on time. Whereas only those under a contractual licence out of the wider spectrum of licences to occupy are bound by this.

Tenants’ rights include the right to quiet enjoyment, privacy and well-maintained property. Tenants can be evicted when they don’t follow the terms of their lease, however, they have protection from unfair eviction.

Protection from eviction means most tenants need a court order to be protected, this is not the case for many under a licence to occupy.

How long can a licence to occupy last?

Licences to occupy are intended to be short-term arrangements. In practice, they commonly last for 6 or 12 months. 

They are typically used as a stopgap for a business that needs a base of operation while they are looking for the ideal premises, or in negotiation for a lease. 

A licence can be as long as each party agrees to. However, when businesses need somewhere to base themselves for a longer period, they should consider taking out a lease on the temporary property they’re occupying if it is suitable for their needs.

Occupying a property under the limited rights of a licence to occupy can end up causing problems over the long term. 

What are the benefits of a licence to occupy?

There are various benefits to a licence to occupy which result from the majority of these arrangements not being formal contracts:

  • They’re quicker to arrange than leases.

  • They offer more flexibility on end dates than leases.

  • The landowner can occupy the property alongside the occupier.

  • The landowner can offer licences to multiple individuals or businesses.

  • A licence to occupy can cover the period between a lease being found and signed off.

  • A licence to occupy sets out the exact circumstances it can be terminated, whereas a landlord can terminate a lease whenever they want.

  • Licensees don’t have to pay SDLT or LTT.

What are the disadvantages of using a licence to occupy?

On the other hand, there are drawbacks to these arrangements:

  • They don’t grant security of tenure to an occupier unless exclusive possession is expressly granted in the agreement.

  • When the licensor disposes of their interest in the property the licence will cease to exist as it’s a personal agreement between the two parties.

  • There are limited controls over rent unlike leases which are protected under rent control regulations, this means licensees could be charged above market rate or face increases out of the blue.

  • The short-term nature of a licence to occupy may not be suitable for businesses looking for long-term accommodation.

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Traditional Law Firms

Pay by the hour

Hourly charges mean costs are hard to predict and you could be charged more than you expect.

Frustrating

It can be take days or weeks to hear updates from your solicitor.

Outdated and offline

Offline and slow procedures will require you to visit firms in-person.

No support

No dedicated support team. You'll have to deal with issues on your own.

Key considerations for a licence to occupy 

Before signing a licence to occupy agreement you should consider the following:

  • They usually don’t benefit from security of tenure.

  • Rent is not controlled by statute.

  • Rights of occupation are personal.

  • Occupation is non-exclusive.

  • Agreements are short term usually but aren’t bound to be.

If you are considering entering into a licence to occupy, it's wise to get legal advice to understand what the agreement may mean for you.

Get in touch with our Legal Assessment Team for a free case evaluation and quote today.

Can a tenant grant a licence to occupy?

A tenant can grant a licence to occupy if this is allowed in the terms of their lease. Most leases however grant exclusive possession which means you wouldn’t be able to share the lease with an occupier by subletting space to them. 

A landlord may allow this if you approach them with a request, however you would need their written consent.

How do you end a licence to occupy?

There are no legal requirements for ending a licence to occupy arrangement. However, most licences include an explanation of the circumstances in which a licence can be ended, these must be followed to the letter.

Commonly a licence is ended when it is triggered by a written notice that gives the occupier several days or weeks to prepare to leave.

Do you have to pay a deposit for a licence to occupy?

This is an area where licences to occupy fall down compared to leases in terms of protection.

Leases have specific requirements when it comes to deposit protection, however, there is no obligation to extend a deposit protection scheme to occupiers. 

How much does a licence to occupy cost?

The cost for a licensed solicitor to help with a licence to occupy is dependent on many factors including the complexity and specific requirements of the case.

On average it is expected to range from £250-£300, but in some cases, it could cost as much as £500.

Can a licence to occupy be converted into a formal tenancy agreement?

A licence to occupy can be converted to a tenancy agreement by the courts when they have been in place for a long time or has been purposefully misused and extended beyond the usual length of a licence – 6-12 months.

If the courts grant a tenancy the occupier turned tenant will have greater protections from eviction.

Are there any restrictions on what activities can be conducted under a licence to occupy?

Under a licence to occupy the occupier can only use the property for specific, limited activities. These will be set out in the agreement. 

If the agreement is breached in this regard the landowner can cancel the licence at short notice.  

What happens if the licensor breaches the terms of a licence to occupy?

If the licensor, the person that grants the licence to occupy the agreement, breaches its terms the licence may be terminated. 

If a licensor gives exclusive possession to an occupier against the terms of the licence in practice, they may unintentionally convert it into a formal lease. Licensors should be cautious about these circumstances if they don’t want to create a lease unintentionally under the Landlord and Tenant Act 1954.

When a lease is created tenants have the right to extend the lease and enjoy protections from eviction.

What happens if the property owner wants to sell or lease the property while a licence to occupy is in place?

A property owner may turn a licence into a lease without meaning to when they sell their property.

This would cause a breach of contract and they may be pursued by the new tenant or new landowner through the courts as a consequence.

How can Lawhive help?

At Lawhive our network of commercial property solicitors can support you in creating a licence to occupy.

Which type of licence to occupy may be suitable for you depending on your circumstances which we can advise you on. 

If you’re looking to enter into or grant a licence to occupy we’d always recommend you seek legal advice first.

Get in touch with us today for a free case assessment and we’ll discuss your case with you.

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