Section 25 Notice Template – Free Download

Are you a commercial landlord who wants to end or renew a lease agreement?

If so, the law prescribes set procedures you must follow in order to make this happen. A key part of this procedure is creating a Section 25 notice to send to the tenant. This outlines the terms of lease renewal, or the statutory reasons for ending the tenancy.

However, these notices can be far from simple, especially if you don’t have a legal background and don’t want to fork out for expensive legal aid. Thankfully, this Section 25 sample agreement lets you tailor the notice to your needs, and use a structure which has already been legally vetted. Simply select the options that apply to you and fill out your details.

But before that, it’s a good idea to understand what Section 25 notices are and how they work, so that you serve them correctly and within the right timescale. Keep reading to find out more.

What is a Section 25 Notice?

A Section 25 notice is called after a section of the Landlord and Tenant Act 1954 (LTA) that specifies the information that a landlord must provide to a tenant (in the form of a notice) in order to terminate a commercial tenancy.

Whether the landlord is opposed to a new tenancy (i.e., wants the tenant to depart) or is willing to offer a new tenancy with adjusted terms of the lease, a s25 notice is required.

Commercial tenancies in England and Wales are covered by the Landlord and Tenant Act 1954, but not in Scotland. This act provides security of tenure for businesses occupying premises for commercial purposes.

The Two Forms of Section 25 Notice

There are two types of Section 25 notices:

• A “friendly” notice that terminates the present lease but affirms the landlord’s willingness to enter into a new lease and propose new terms the landlord and tenant agree to.

• A “hostile” notice that terminates the current lease to oppose the grant of a new tenancy on one of the few grounds permitted.

A Section 25 notice must be served at least 6 months in advance, and no more than 12 months in advance – for both scenarios. These timelines must be taken into account when determining when to serve a Section 25 notice to coincide with the lease’s end date.

How to Serve a Section 25 Notice Form

1. Confirm Eligibility

First of all, you must check the lease terms because they will usually specify how all notices should be served, and if they are not followed, the notice will most likely be faulty.

Ensure the tenancy is a business tenancy covered by the Act, and equally, that the tenant has not contracted out of the 1954 Act protection.

If you refuse to extend the lease as a landlord, the S25 notice must be served with 6-12 months notice for the tenant before it expires. The date the landlord sets for the end of the tenancy could be the lease’s final date.

What if the tenant serves a Section 26 notice? 

If the tenant has already filled out a Section 26 notice, a Section 25 notice cannot be served by the landlord. A Section 26 notice can be created by the tenant to request a new tenancy, along with their proposed terms.

 

2. Choose the Type of Section 25 Notice

There are two types: 

• “Hostile” notice – Where you oppose renewal of the lease. 
• “Friendly” notice – where you propose to renew the lease but on different terms with the tenant. 

3. Prepare the Section 25 Notice

Use the prescribed wording and format (no standard form, but strict legal requirements), and include these critical details: 

• Landlord’s name and address 
• Tenant’s name and address 
• Address of the premises 
• Date of termination (must be between 6–12 months from the date of notice) 
• Whether renewal is opposed or proposed 

If you oppose the creation of a new lease with the tenant, then you need to state the statutory grounds upon which you do this (e.g. breach of obligations, to demolish or reconstruct the property). Alternatively, if you intend to construct a new lease with the tenant, you will have to clearly state the new terms, which will include how long the tenancy will last, proposed rent (and more). 

4. Serve the Notice Properly

Section 196 of the Law of Property Act 1925 will typically apply if there is no lease or if the lease is quiet on the question of service. The service is available via hand/personal delivery or recorded mail. 

The notice must be in the prescribed form as set out under the grant of the Landlord and Tenant Act 1954, Part 2, Notices Regulations 2004. 

Even so, there are several methods of allowable notice delivery for landlords: 

• Personal delivery 
• First-class post to tenant’s last known address 
• Recorded delivery (recommended for proof) 
• Process server (for contested cases) 

You should also keep proof of service, including the date of delivery, name of person served and the method of service 

5. Await the Tenant’s Response

When a S25 notice is served, it usually prompts a negotiation with the tenant, either over the conditions of a new lease or over the landlord’s reasons for opposing a new tenancy and the validity of those reasons. 

Tenants must pay attention to the deadline in the Section 25 notice, as the consequences can be severe for their business tenancy. 

The renter must do one of the following by the deadline specified in the notice: 

• Have agreed to and negotiated a new lease with the landlord; or have agreed in writing with the landlord to extend the notice date; or 
• Initiated legal action to get a new lease and a determination on its terms; or 
• Chosen to vacate the premises and end the tenancy 

The tenant loses the right to occupy the premises and the right to a new lease if none of these actions are done. 

Either party can apply to the court to decide if a new lease should be granted, and on what terms, starting from two months after a Section 25 notice has been served. This can be done without waiting for the full six-month notice period to expire. While this option is rarely used in practice, it can be a useful tool when time is of the essence. 

For property owners, converting from a leasehold to a freehold or an extended lease may provide additional benefits and control over the property. 

Click here to use our Section 25 notice template. 

Landlord Grounds for Opposing Lease Renewal 

The particular reasons for which a landlord can oppose lease renewal for their tenants are described in  Section 30(1) of the Landlord and Tenant Act: 

1. Tenant’s failure to repair the property 
2. Persistent delay in paying rent 
3. Other breaches of lease obligations 
4. Alternative accommodation available for tenant 
5. Sub-letting of whole premises 
6. Landlord intends to redevelop the property 
7. Landlord want to occupy the premises for own business 

Some grounds (the last two) sometimes entitle the tenant to statutory compensation from the landlord. 

Can a Section 25 Notice Be Cancelled or Withdrawn? 

Yes it can, but only in some circumstances. Once a Section 25 notice is served, it becomes legally binding, so the landlord can’t simply revoke it. The notice triggers the statutory lease termination or renewal process under the Landlord and Tenant Act 1954, and both parties’ rights are affected. Therefore, cancelling or annulling the notice requires careful legal steps and for the tenant to co-operate. 

This demonstrates why it is so, so important to get this process right the first time. It is much better to take your time mulling over the notice or new lease terms than to serve a Section 25 notice without due thought.  

However, here are some of the ways an S25 notice may be withdrawn: 

1. By Mutual Agreement

A Section 25 notice can be withdrawn if landlord and tenant agree to do so. This is the most common way to cancel it. In practice, this is formalised by written agreement (e.g. Deed of Withdrawal) or a clearly worded letter confirming both parties no longer wish the notice to have effect. Without the tenant’s consent, the landlord has no legal power to undo the notice once served. 

2. By Court Action Being Abandoned or Dismissed

After serving notice, either party can apply to the court for a decision on a new lease, and on what terms. If this process begins but is abandoned by the applicant, or if the court dismisses the application (e.g. because of procedural issues), the original notice still stands.  

Unless a new agreement is made, the lease will end on the termination date specified in the notice. Even then, this situation does really not annul the notice; it simply concludes the renewal process without a new lease being ordered by the court. 

3. By Serving a New Notice (inadvisable) 

In very rare cases, landlords attempt to serve a new Section 25 notice if the original one was defective or contained incorrect information. This can only be done if the timing still allows for it (as in, the new notice still provides between 6 and 12 months’ notice for the tenant).  

However, even this does not automatically “cancel” the original notice. For the new notice to be effective and replace the previous one, the tenant would typically need to agree in writing to disregard the first. Otherwise, the original notice remains in force. 

What Options Does a Section 25 Notice Give to Tenants? 

If the tenant does not want to extend the lease, the solution is simple: do nothing and vacate the property by the Section 25 notice’s termination date. 

• No additional action is required if the tenant chooses to renew the lease and the parties achieve an agreement on lease terms before the Section 25 notice expires (provided the new lease is completed by the required date). 
• If the tenant intends to renew the lease, the landlord will not object to a new lease; however, because agreement on new lease conditions will not be reached before the Section 25 notice expires, the tenant should apply to the Court for a new lease before the notice expires. 
• If the parties cannot agree on new lease terms, the Court will assist them in reaching an agreement. 
• If the tenant intends an extended lease and intends to renew it, but the landlord objects, the tenant should apply to the Court for a new lease before the Section 25 notice expires  – if the landlord has not previously filed to the Court for the termination of the lease. The Court will then assist in determining how and whether a new lease should be awarded. 

Rent & Compensation for Tenants Under Section 25 

If the tenant has applied to the Court for a new tenancy, the current tenancy will not cease when the Section 25 notice expires, but will instead continue at the same rent for three months after the Court procedures are completed.  

During this time, either the landlord or the renter might request for a “interim rent.” 

• If the tenant fails to get a new lease, the tenant may be entitled to compensation in certain circumstances and if particular conditions are met. If you find yourself in this scenario, we can help you determine if you are entitled to compensation. 
• Unless the tenant has been in the property for at least 14 years, the compensation provided will be the comparable sum to the ratable worth of the property. 

Ready to Fill Out a Section 25 Notice Form? 

It’s critical for landlords to understand their rights to terminate a new lease (once the current one expires) and to negotiate or oppose a new rental arrangement. 

Leases will often simply roll over until a Section 25 notice is served. So, it’s critical that the Section 25 notice be correctly drafted and delivered, and that the tenant keeps track of the deadlines and takes prompt action to defend their position. 

If you’re ready to get started, then simply use our free template, armed with the information you now know about Section 25 rules.