Occupational Rent
(Last Updated: 05/09/2022)
05/09/2022
116
4 min read
If you and your partner split up, but you own a property together, you could be entitled to receive occupation rent from them. As long as the house is co-owned, you both have a right to it and if one party is excluded from the premises, financial compensation can be requested.
If you're having a property dispute with your ex partner and you think you might be entitled to occupational rent, get in contact now.
What does occupational rent mean?
The term refers to a financial compensation that can be requested by individuals who own a property with their partner but have split up. When this happens, the party that is occupying the property can be subject to paying rent to the one excluded from its premises.
This happens because both are entitled to any proceedings resulted from the house and they also both have the right to occupy it. If one is denied access to it for whatever reason, they can seek reimbursement.
Marriage is not a requirement for this. You can be entitled to (or liable to pay) your ex partner rent no matter the type of your relationship, as long as both partners have a beneficial ownership.
How is occupational rent calculated?
The modern approach is investigating what the market value of the property is and awarding the excluded party their relevant share (usually half).
However, before making any decision, the court will take into consideration a series of factors, such as the duration of the occupancy, any home improvements that may have been done to the property, as well as the existence of children and whose care they're in.
Another key factor is the share of the property that the claimant is entitled to.
Based on all of these, an appropriate amount will be agreed on. In some cases, if the remaining resident is left to pay the mortgage or cover any other costs by themselves, the request for occupation rent can be denied.
There is not a clear set of rules for this process. When making a decision, the court will take into consideration every detail and will act on a case-by-case basis. For example, if the residing party is left to pay the mortgage by themselves, the other one's claim can be denied under the premise that the two cancel each other out.
Similarly, in the case of Bailey v Dixon [2021], the request for occupational rent was not granted because the departing party had voluntarily chosen to leave. Since the residing partner did not deny the other's rights to the property, they did not have to pay.
For this reason, it is important that you get professional advice first. We can get you in contact with a solicitor.
What can affect the court's decision?
Home improvements
The market value of a property can be heavily increased by doing home improvements. This can affect both partners, depending on when the improvements have been made.
For example, as the excluded party, if you buy a house with your partner, make improvements to it, and break up several years later, you can benefit from it. Since the market value of the house has increased, the rent you receive will be higher.
In contrast, if the residing party is conducting home improvements after the split, they can claim back their ex's share for either the cost of the work or the increase in value, whichever one is lower.
Children
Children can affect the outcome of this dispute. In the past, this aspect did not have any correlation with the end result, however under s13(4) TOLATA, the purpose of the property and the circumstances of each party is relevant in the decision-making process.
As a result, if the property was initially bought with the assumption that it would become a family home or if the occupant is the sole carer of the children, the excluded party's request for rent can be denied.
*This article is only meant to serve as a guide and not as legal advice.
Frequently Asked Questions
ForcedOccupationalRent
HowToOccupationalRent
OccupationalRentTax
Written by:
Laura Cristian
Laura has a talent for data analysis and fact-finding. She is an advertising graduate with a broad range of skills in the web marketing field within conveyancing sector. She works closely with our panel of solicitors and surveyors to understand our clients' needs and challenges and to write the most valuable content for you.
Reviewed by:
Andrew Boast
Andrew started his career in 2000 working within conveyancing solicitor firms and grew hands-on knowledge of a wide variety of conveyancing challenges and solutions. After helping in excess of 50,000 clients in his career, he uses all this experience within his article writing for SAM, mainstream media and his self published book How to Buy a House Without Killing Anyone.
