What is rent?

Rent can be defined as the total amount paid to a landlord by a tenant/occupier in return for the use and occupation of accommodation.

This content applies to Scotland

Treated as rent

Rent is usually paid with money. Where no money is paid, the normal conclusion should be that there is no rent, and therefore, no tenancy. However, occasionally, other obligations such as liability to pay rates, repair bills and maintenance obligations can be treated as a kind of rent. [1]

Provided both parties agree and the rent, in whatever form it takes, is definite, then this will be contractually enforceable between landlord and tenant. Tenants who do not pay rent, or pay an extremely low rent, will have very limited security of tenure. A tenancy at a low rent will be excluded from the security of the Rent (Scotland) Act 1984 [2] and from being an Assured tenancy under the Housing (Scotland) Act 1988. [3]

If the lease agreement does not make clear what the rent is and when it is to be paid, then it may be difficult to argue that there is a tenancy.

The agreement between landlord and tenant should include information on:

  • how much rent should be paid

  • what is included in the rent, for example, heating

  • to whom the rent should be paid

  • when the rent should be paid.

Inclusive or exclusive rent

Rent may be either inclusive or exclusive. Exclusive means that the tenant pays simply to occupy the property, although the landlord will still have to meet his or her basic obligations such as the duty to make repairs.

Inclusive means that the tenant pays for more than the basic right to occupy. An inclusive rent will commonly include things like electricity and gas, phone rental. Inclusive rents are often found in situations where there is a resident landlord or where a building is composed of a number of bedsits or flats. The rent will often include payments for the maintenance of common parts. Exactly what is being paid for will depend on individual agreements and should be clearly stipulated.

Council tax

In addition to rent the tenant may pay an amount to cover the council tax on the property where the owner is liable. If council tax is due, the tenant will have to make separate payment to the local authority.

If the landlord is responsible for paying council tax, then the right to increase the rent to cover a rise in council tax depends upon what is in the lease/tenancy agreement.

See the pages on Council tax: liability and exemptions for information on who should be liable.

Last updated: 27 July 2020

Footnotes

  • [1]

    Scottish Residential Estates Development Co. v. Henderson 1991 SLT 490.

  • [2]

    s.2(1)(a) Rent (Scotland) Act 1984

  • [3]

    s.12 and para 2 sch. 4 Housing (Scotland) Act 1988