Tenancies that cannot be private residential tenancies

Almost all new private tenancies created on or after 1st December 2017 are private residential tenancies.  

This content applies to Scotland

Exemptions to PRT

However, there are a number of exemptions  and these are listed in Schedule 1 of the Private Housing (Tenancies) (Scotland) Act 2016 [1]

Tenancies at a low rent

Tenancies at a low rent cannot be private residential tenancies. Such tenancies are very rare. 'Low rent' is defined as being less than £6 per week [2] In calculating the rent, money paid for services, repairs, maintenance and insurance should be ignored.

Tenancies of shops

Where the Tenancy of Shops (Scotland) Act 1949 applies to a tenancy, the tenancy cannot be a private residential tenancy.

Licensed premises

Licensed premises cannot be the subject of an assured tenancy. This applies to anywhere that sells alcohol for consumption on the premises. It therefore includes restaurants, hotels, wine bars and so on, but excludes off-licences. This provision does not prevent, for example, a publican letting a flat above a pub as a private residential tenancy.

Tenancies of agricultural land

Where the tenancy includes agricultural land exceeding two acres, or if is a ‘relevant agricultural tenancy’ the tenancy cannot be a private residential tenancy, A relevant agricultural tenancy is one which falls within the definition given in the Agricultural Holdings (Scotland) Act 2003 of being:

  • A 1991 Act tenancy

  • A short limited duration tenancy

  • A limited duration tenancy

  • A modern limited duration tenancy or

  • A repairing tenancy

Lettings to students

Lettings to students, where the student is renting accommodation from their educational establishment, cannot be private residential tenancies. Most educational establishments come under this exemption, such as universities, central institutions, designated institutions, further education colleges, colleges of education and the Royal College of Surgeons of Edinburgh.

This does not apply to students who rent from other parties, such as private landlords unless planning permission was given for the property on the basis that the let property would be used predominantly for housing students and the landlord is an institutional provider. This is defined as: [3]

  • The landlord lets or is entitled to let other buildings in the same complex and

  • The let property and other properties include at least 30 bedrooms and

  • The landlord uses or intends to use the other properties predominately for the purpose of housing students.

Holiday lettings

If the purpose of the tenancy is to provide holiday accommodation, the tenancy cannot be a private residential tenancy.

Additionally, a tenancy cannot be a private residential tenancy if it is a short-term let as defined by article 3 of the Civic Government (Scotland) Act 1982 (Licensing of Short-term Lets) Order 2022. [4]

A short-term let is defined as residential accommodation where all of the following are met [5]:

  • the short-term let is entered into for commercial consideration, such as money or benefit in kind

  • the guest does not use the accommodation as their only or principal home

  • the guest is not a family member

  • the guest does not share the accommodation with the host for the principal purpose of advancing the guest’s education as part of an arrangement made or approved by a school, college, or further or higher educational institution

  • the guest does not own or part-own the accommodation

  • the accommodation is not an excluded tenancy or accommodation [6]

Where there are any doubts it may be useful to look at whether the let has features which suggest that it falls under the requirements to meet a particular tenancy type. For example, is it the clients only or principal home? Are all the elements of a lease present? 

If this is the case then it is arguable that, even if the property was advertised or in some way described as a holiday let, it may in fact be a private residential tenancy. [7]

Resident landlords

Where the tenant shares accommodation with the landlord, the tenancy is not a private residential tenancy. However, the definition of 'resident landlord' can be complicated. A number of conditions must be fulfilled: [8]

  • The accommodation let to the tenant (house, or part of a house) must form only part of a building.

  • At the creation of the tenancy, there was an ordinary means of access to the tenant's accommodation by way of the landlord's accommodation (or vice versa).

  • The landlord must have been living in accommodation that also forms part of the building from the time the tenancy was created.

Advisers need to be vigilant in such cases, as there can often be difficulties in defining resident landlords and some tenants may not appreciate their rights.

If a resident landlord sells the property, the new resident landlord is allowed up to 28 days to take up occupation of the dwelling as their only or principal home before the tenancy becomes private residential tenancy. The counting begins on the day of the sale. Alternatively, if the new landlord notifies the tenant in writing within the 28-day period that they intend to take up occupation, they can have up to six months from the day of the sale. [9] During such a period the landlord is treated as a resident landlord and has all the rights and obligations that a resident landlord enjoys.

If a resident landlord dies, the tenancy will be treated as being subject to a resident landlord for up to two years, while the executor settles the estate. [10] The new landlord who has inherited the property may move in during this period and still be treated as a resident landlord.

Police Housing

If the landlord is the Scottish Police Authority the tenancy cannot be a private residential tenancy.

Military Housing

A tenancy cannot be a private residential tenancy if the landlord is the Secretary of State for Defence.

Social Housing

A tenancy cannot be a private residential tenancy if the landlord is: [11]

  • a local authority

  • a registered social landlord

  • a fully mutual co-operative housing association

  • Scottish Water

Sublet, assigned etc. social housing

A tenancy cannot be a private residential tenancy if it arises as a result of a Scottish secure tenancy or a Scottish short secure tenancy being assigned, sublet or otherwise given up.

Homeless persons

Local authorities have duties under homelessness legislation to provide homeless applicants with accommodation. Where accommodation is provided on a temporary basis as a result of these duties the tenancy cannot be a private residential tenancy.

Persons on probation or released from prison etc.

Under the Social Work (Scotland) Act 1968, local authorities have a duty to provide advice, guidance and assistance to offenders released from prison. Tenancies granted for less than six months under this provision will not be private residential tenancies.

Accommodation for asylum seekers

Tenancies granted to asylum seekers or their dependents under Section 4 or Part VI of the Immigration and Asylum Act 1999 will not be private residential tenancies. For more information on accommodation for asylum seekers, please see the section on asylum seekers.

Displaced persons

A tenancy cannot be a private residential tenancy if the purpose of it is to provide accommodation under the Displaced Persons (Temporary Protection) Regulations 2005 SI 2005/1379.

Shared ownership

Where an occupier part owns and part rents their home under shared ownership agreement within the meaning of s.83 of the Housing (Scotland) Act 2001 then this cannot be a private residential tenancy.

Tenancies under previous legislation

A tenancy cannot be a private residential tenancy if it is:

  • A protected tenancy within the meaning of the Rent (Scotland) Act 1984,

  • A tenancy to which Part IV of that Act applies

  • A Part IV contract under that Act

Assured or Short Assured tenancies

A current assured or short assured tenancy within the meaning of the Housing (Scotland) Act 1988 is also excluded from being a private residential tenancy. No new assured or short assured tenancies can be created from 1st December 2017. [12] All assured or short assured tenancies created prior to this date however, will continue whether by contract or tacit relocation, until such time as they are correctly ended.  

There is an option for a landlord and tenant to agree to convert an existing assured or short assured tenancy into a private residential tenancy if they choose to. [13]

Accommodation for veterans and care leavers

A tenancy cannot be a private residential tenancy if the landlord is: [14]

  • a charity providing accommodation to veterans, or

  • a charity providing temporary accommodation to a care leaver

A “care leaver” is defined as a person who:

  • is under the age of 26 years,

  • was on that person’s sixteenth birthday or at any subsequent time looked after by a local authority, and

  • is no longer looked after by a local authority; and “looked after” is to be construed in accordance with sections 17(6) (duty of local authority to child looked after by them) and 29(7) (after-care) of the Children (Scotland) Act 1995(1).

“Charity” has the meaning given in section 106 of the Charities and Trustee Investment (Scotland) Act 2005(2).

“Veteran” means a person who has served:

  • for at least one day in Her Majesty’s Armed Forces (regular and reserve), or

  • as a member of the Merchant Navy on a civilian vessel while supporting the Armed Forces.

Last updated: 11 May 2022

Footnotes

  • [1]

    Schedule 1 Private Housing (Tenancies) (Scotland) Act 2016

  • [2]

    sch. 1 para. 1(a) Private Housing (Tenancies) (Scotland) Act 2016

  • [3]

    sch. 1 para. 5(4) Private Housing (Tenancies) (Scotland) Act 2016

  • [4]

    sch. 1 para. 6(2) Private Housing (Tenancies) (Scotland) Act 2016

  • [5]

    s.3 Civic Government (Scotland) Act 1982 (Licensing of Short-term Lets) Order 2022

  • [6]

    sch. 1 Civic Government (Scotland) Act 1982 (Licensing of Short-term Lets) Order 2022

  • [7]

    St Andrews Forest Lodges Ltd v Grieve, (2017) SC Dun 25 [2017] G.W.D. 14-224

  • [8]

    sch. 1 para. 7 Private Housing (Tenancies) (Scotland) Act 2016

  • [9]

    sch. 1 para. 9(4)(a) Private Housing (Tenancies) (Scotland) Act 2016

  • [10]

    sch. 1 para. 9(4)(b) Private Housing (Tenancies) (Scotland) Act 2016

  • [11]

    sch. 1 para. 14 Private Housing (Tenancies) (Scotland) Act 2016

  • [12]

    (From 1st Dec 2017) s.12 Housing (Scotland) Act 1988

  • [13]

    s.46A Housing Scotland Act 1988 as amended by sch. 5 para. 3 Private Housing (Tenancies) (Scotland) Act 2016

  • [14]

    sch. 1 para. 22 Private Housing (Tenancies) (Scotland) Act 2016 as amended by s.2 The Private Housing (Tenancies) (Scotland) Act 2016 (Modification of Schedule 1) Regulations 2019 SSI 216/2019