Commercial Rent Increase Notice Template for England and Wales

A commercial lease rent increase notice is your formal method of telling a commercial tenant that their rent is going up, in line with the lease agreement and England and Wales legislation. It confirms the current rent, the new rent, and the date the increase takes effect, so both sides work from the same figures and can agree the change without confusion. Getting the process and the notice periods right is what makes the increase enforceable if the tenant later challenges it.

When do you need this document?

You need a commercial rent increase notice when your commercial lease contains rent review provisions that allow for periodic rent increases. This typically happens at intervals set in the lease, such as every three or five years. You will also need it when exercising a market rent review clause, implementing an RPI or CPI linked increase, or when the lease specifically requires formal notification of a rent adjustment. The notice is often used during lease renewal negotiations where new rental terms are being established, or when increasing rent in stepped instalments agreed in the original lease. If you also manage the underlying agreement, see our lease agreement templates to check how the rent review clause is drafted.

How does the rent increase process work?

The process usually runs in a short sequence:

1. Confirm the review date and the calculation method set out in the lease.
2. Work out the new rent, whether that is a fixed percentage, a market rent figure, or an index linked amount.
3. Prepare the notice with the current rent, the new rent, and the effective date.
4. Serve it using the method the lease permits and keep proof of delivery.

Serving the notice early, within the lease's notice window, gives the tenant time to review the figures, raise questions, and agree the increase before it takes effect. This review process reduces the risk of a challenge and keeps the landlord and tenant relationship on stable footing.

What should the notice include? A worked example

A clear notice removes room for dispute. As a worked example, a landlord reviewing a five year lease might state: current rent 40,000 GBP per annum, new rent 44,000 GBP per annum (a 10% increase under the RPI linked review clause at clause 4.2), effective from 1 June 2026, with the reference to the lease clause that authorises the increase and the method of service. Naming the exact clause, the figures, and the date makes the notice self contained and hard to challenge.

How to increase rent without breaking the lease

When you increase rent, the figure has to track the mechanism in the contract, not a number you would prefer. Check the condition of the review clause first: whether it is upward only, capped, or open to a downward adjustment. If the lease links the increase to an index, use the correct base and review dates. If it turns on market rent, base the tenant rent figure on comparable evidence for similar premises. Get this wrong and the notice can be treated as invalid, so the cost of a rushed review is often a longer, more contested one.

Key legal considerations

Your commercial rent increase notice must comply with the notice periods in your lease agreement, which typically range from three to six months before the effective date. The notice must clearly state the current rent amount, the new rent figure, and the exact date the increase takes effect. The rent increase mechanism must follow the method specified in your lease, whether that is market value, retail price index, or a predetermined formula. The notice should reference the specific lease clause that authorises the increase and must be served in accordance with the service provisions in your lease. If your tenant has outstanding COVID-19 related rent arrears, consider the Commercial Rent (Coronavirus) Act 2022 implications before proceeding.

Legal requirements in England and Wales

Under England and Wales law, your rent increase notice must comply with the Landlord and Tenant Act 1954, particularly where the premises qualify as business tenancies under Part II of the Act. The notice must be served using the method specified in your lease agreement, which may include personal service, recorded delivery, or email if expressly permitted. Ensure the notice period meets both the lease terms and any statutory minimum. The Landlord and Tenant (Covenants) Act 1995 governs enforcement of rent payment obligations, making proper service important for any later enforcement. Keep the wording clear and unambiguous, and make sure it accurately reflects the agreed rent review mechanism so both parties can agree the new rent with confidence.