Let’s keep this simple. If you rent long-term in the same property, especially in London, there’s a little-known rule that might apply to you.
Once your total rent over time goes above £125,000, you may need to file paperwork with HMRC. In some cases, you might also pay a small amount of tax.
Most tenants have never heard of this, and to be fair, until now, it didn’t really matter.
Why This Is Suddenly Relevant?
The Renters’ Rights Act is changing how tenancies work.
– No more standard fixed terms resetting every year
– More long-term, endless rolling tenancies
Sounds like a good thing, more stability, but here’s the catch:
The longer you stay in one property, the more your total rent builds up over time.
Eventually, some tenants could cross that £125k threshold over a number of years without realizing.
Not everyone needs to worry, but you should be aware if:
– You’re renting in London or higher-priced areas
– Say you’re paying £1,500 per month and you plan to stay in one place for several years
£1,500 per month = £18000 per annum. Stay for 7 years = £126,000. Above the SDLT threshold
Rough guide:
So around 5–7 years in the same property on a not overly high rent (for London) and you might hit it.
What Actually Happens? If you do cross the threshold:
– You may need to submit an SDLT return
– You might pay a small amount of tax
The tax itself is usually not the issue. It’s often relatively small.
But here’s the key point:
HMRC can still issue fines if you don’t file, even if you had no idea this rule existed. That’s where tenants can get caught out.
Why This Is a Bit of a Grey Area and could get messy.
– Most tenants don’t know this exists
– Many agents don’t flag it because many are also unaware of it!
– The rules weren’t really designed for today’s rental market
And with the Renters’ Rights Act pushing longer tenancies…more people could fall into this without realising.
Where Pets Come Into This
If you’re renting with a pet, you’re more likely to:
– Stay longer once you secure a good property
– Avoid moving due to limited pet-friendly options
Which means you’re actually more likely to hit this threshold over time.
It’s not a reason to panic, just something to be aware of.
Practical Advice (Keep It Simple)
- Don’t panic
This doesn’t affect most people short-term.
- Be aware if you’re staying long-term
Especially 5+ years in the same property.
- Keep an eye on your rent level
Higher rent means you reach the threshold faster.
- Don’t ignore HMRC letters
If something comes through, deal with it early.
- Ask the question
If you’re unsure, speak to your agent, landlord, or a tax professional.
Pets Lets Expert Insight
This is one of those classic examples where the rules haven’t quite caught up with how people actually rent today. It may well change and not be a problem. Speaking to a leading estate agency, the Government seem to be ignoring it as an issue. Can’t see HMRC doing the same!
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About the Author – Russell Hunt
Pets Lets Expert Insight
This article was written by Russell Hunt, co-founder of Pets Lets, a specialist service helping tenants secure pet-friendly property to rent in London and across the UK.
With more than 30 years of experience in the London property market, Russell works with tenants, landlords and estate agents to make renting with pets possible in practice, not just in theory. His work focuses on helping pet owners present strong applications, prepare properly for competitive markets, and navigate landlord concerns around pets.
Through Pets Lets, Russell supports UK tenants with pets as well as educates landlords with UK properties on the benefits of dog friendly rentals and cat friendly rentals in London and across the UK.
Russell also runs the community “Relocating to the UK with Pets”, helping thousands of members understand the realities of travelling to the UK with pets.
Learn more about pet-friendly renting advice and services at Pets Lets
For further guidance on renting with pets, visit Dogs Trust’s Lets with Pets
