Licence to Alter Template for the United Kingdom
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What is a Licence to Alter?
A Licence to Alter is a legal document by which a landlord grants a tenant formal consent to carry out specified alterations or improvements to a leased property. It records the scope of the permitted works, the conditions attached to that consent and each party's ongoing obligations, sitting alongside the existing lease rather than replacing it. This document is commonly used for commercial premises where the underlying lease requires the landlord's approval before any structural or non-structural changes can be made.
Frequently Asked Questions
What is a Licence to Alter?
It is a document in which a landlord formally consents to a tenant carrying out specified alterations to a leased property. It supplements the existing lease and sets out the conditions attached to the works.
Do I need a Licence to Alter if my lease already permits alterations?
Many commercial leases require the landlord's prior written consent before alterations can be made, in which case a Licence to Alter records that consent. You should check the alterations covenant in your lease to confirm whether one is needed.
Can a landlord refuse consent to alterations?
For improvements, the Landlord and Tenant Act 1927 provides that consent must not be unreasonably withheld, though a landlord may impose reasonable conditions. What is reasonable depends on the works and the terms of the lease.
Who pays for the Licence to Alter?
It is common for the tenant to pay the landlord's reasonable legal and surveyor's costs of preparing and completing the licence. The exact position should be set out clearly in the document.
Does the same guidance apply in Scotland and Northern Ireland?
Property and landlord and tenant law differs in Scotland and Northern Ireland, so some statutes and procedures referred to here may not apply. You should take local advice for premises in those jurisdictions.
About the Licence to Alter
A Licence to Alter usually covers the following.
- Parties and Recitals: Identifies the landlord, tenant and any guarantor or superior landlord, and refers to the underlying lease being supplemented.
- Description of Works: Sets out precisely the alterations permitted, usually by reference to attached plans, specifications and drawings.
- Conditions of Consent: States the conditions the tenant must satisfy, such as obtaining planning permission, building regulations approval and any necessary third party consents.
- Tenant Covenants: Records the tenant's promises to carry out the works properly, with due diligence and in compliance with all applicable laws and regulations.
- Reinstatement Obligations: Specifies whether and when the tenant must remove the alterations and reinstate the property at the end of the lease term.
- Costs and Indemnities: Provides for the tenant to pay the landlord's reasonable legal and surveyor's fees and to indemnify the landlord against liabilities arising from the works.
- Insurance and Compliance: Requires appropriate insurance to be in place and confirms that the works will not invalidate the building's insurance cover.
- Effect on the Lease: Confirms that the lease continues in full force and effect and clarifies how the alterations are treated for rent review and yielding up purposes.
GOVERNING LAW
Applicable law
This Licence to Alter is drafted to comply with United Kingdom law. Key legislation includes:
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