Garage Tenancy Agreements: What UK Landlords Need to Include

The first paperwork question most new garage landlords ask is "what tenancy agreement should I use?" The answer starts with a correction: you do not want a tenancy agreement. You want a licence agreement.

The distinction is technical but it matters. A tenancy gives the tenant exclusive possession of premises — and if it is residential, brings the entire residential lettings regime with it. A licence gives the licensee permission to use premises without exclusive possession, and sits outside the residential regime entirely.

For garages, you almost always want the licence. It is simpler, more flexible, and avoids the regulatory baggage.

Why a licence works for garages

Three legal facts make the licence the default for garage lettings:

Garages are not residential dwellings. The Housing Act 1988, the Renters' Rights Act 2025, and the Protection from Eviction Act 1977 are aimed at residential lettings. A garage let purely for storage is not a residential let. The deposit-protection regime, the prescribed forms regime, and the assured-tenancy framework all do not apply.

Storage uses do not require exclusive possession. A garage tenant who uses the garage for storage typically does not need (and is not given) the same level of exclusive possession a flat tenant has. The landlord retains rights to access in emergencies, to inspect, and to terminate on notice without going through the courts.

Termination is by notice, not by Section 21. A licence agreement specifies how it can be terminated — typically by either party giving 28 days written notice. There is no court process required. If the tenant stops paying and the licence is properly terminated, the landlord can change the locks (subject to the procedural protections discussed below).

What your licence should contain

A garage licence agreement is a short document — typically 2-3 pages, far shorter than a residential AST. The essential clauses:

1. Parties. Full name and address of landlord and tenant. Photo ID copy retained.

2. The premises. Specific identification of the garage — block, unit number, postcode, accompanied by a plan if helpful.

3. Permitted use. Critical clause. Specify what the garage may be used for: "storage of household goods and personal effects" is the typical wording. Excluded uses: "residential occupation, commercial business activity, storage of hazardous, perishable, or illegal goods, or as a workshop without prior written consent." This protects you from a tenant turning the garage into a sleeping space, a cannabis farm, or a paint-spray workshop.

4. Term and termination. Typically rolling monthly. Either party may terminate by 28 days written notice. Landlord may terminate immediately for serious breach (non-payment of two consecutive months rent, illegal use, damage to the premises).

5. Rent. Monthly amount, payment date, payment method (typically standing order). Late payment terms — common: rent unpaid by the 7th of the month attracts a £25 administrative fee.

6. Deposit. A licence deposit of one month rent is standard. State that the deposit is held to cover damage and unpaid rent, and that it will be refunded within 28 days of the licence ending, less any deductions.

7. Insurance. Confirm that the licensee insures their own contents. The landlord insures only the structure and public liability. The licensee enters and uses the garage at their own risk.

8. Access. Reserve the landlord right to enter the garage on 48 hours notice for inspection or repairs, and immediately in emergencies.

9. Maintenance and damage. The licensee must keep the garage in reasonable condition, must not alter or damage the premises, and must repair any damage caused by their use beyond fair wear and tear.

10. Compliance with law. The licensee will not use the garage for any illegal or prohibited purpose. Breach is grounds for immediate termination.

11. Governing law. "This agreement is governed by the laws of England and Wales." (Or Scotland / Northern Ireland, depending on jurisdiction.)

That is it. Three pages, signed by both parties, kept on file.

What you don't need

The clauses you would include in a residential AST and do not need here:

• A prescribed form. Garage licences are not subject to the prescribed-form requirements that residential ASTs are.
• A How-to-Rent booklet. Not applicable.
• Deposit protection. A licence deposit on a non-residential agreement is not a protected deposit under the Housing Act schemes.
• Energy Performance Certificate. EPCs apply to dwellings, not garages.
• Right-to-rent checks. These apply to residential lettings; garage licences fall outside.

This is the substantive efficiency of the garage business model. The compliance overhead per pound of profit is a fraction of residential.

Practical procedural protections

Despite the licence framework, two procedural notes:

Even where the law allows you to change the locks, do it carefully. If a tenant in default leaves goods in the garage, you cannot dispose of them at will. Common practice is to write to the tenant last known address giving 28 days notice that the goods will be disposed of, retain valuable items for 6 months, and document everything. Specific advice is worth taking before you change locks on an occupied garage.

Refunds and deductions. If you are deducting from the deposit, send the tenant an itemised statement with photos. Disputes over deposits sometimes end up in the small claims court, and a clear paper trail is the difference between losing the dispute and winning it.

Where to get a template

We recommend not downloading a tenancy agreement from a generic property forum and adapting it — most are aimed at residential lettings and import legal language that is wrong for garages.

A short bespoke licence agreement is something a property solicitor will draft once for £150-300, and you reuse it across your portfolio with the tenant details swapped in. That investment pays for itself the first time a tenant disputes the licence.

If you have an Investor membership, the licence template we use is available in the dashboard. Otherwise, the bullet list above is a complete specification — give it to your solicitor and ask for a draft.

This article is general guidance, not legal advice. Specific situations — particularly tenant disputes, illegal use, and goods abandonment — should be reviewed by a property solicitor.