Guidance

Lease closure with transfer of part or new lease

Published 13 November 2024

Applies to England and Wales

1. Overview

The following Lease closure transactions are available when applying for a transfer of part (TP) or a new lease (NL). 

1.1 Lease closure – by disclaimer (TP) 

Use where bankruptcy or liquidation has occurred. 

1.2 Lease closure – by notice (TP/NL) 

Use where the lease is terminated, for example following exercise of a break notice. The lease needs to be outside Landlord and Tenant Act 1954 and the Local Government Housing Act 1989. You can use panel 9 of the CN1 to provide confirmation. Where determined by notice, provide a copy of the notice. 

1.3 Lease closure – merger with reversionary estate (TP) 

Make sure you are able to apply for merger with reversionary estate before you select this transaction. 

Two estates must be in same ownership (same person, same capacity, for example, 1 absolute owner & 1 trustee or personal representative - not possible).

You may need to: 

• provide evidence that the applicant holds all estates in the same capacity 
• provide evidence that the applicant holds all estates upon the same trusts 
• provide evidence that the trust no longer applies (so you’ll need to apply to cancel the existing Form A restriction or apply for a Form A restriction on the title or titles which does not have one together with a certificate that the applicant holds all estates upon the same trusts or if you are also lodging an application for transfer or Form A restriction in a transfer, make sure you choose the correct priority order (for example, transfer first) 

1.4 Lease closure – of assured tenancies following court order (NL) 

Refer also to Schedules 1 and 7 of the Housing Act 1988. This is only for use where the lease is registered. 

1.5 Lease closure – on frustration (NL) 

Use for the automatic determination of a lease by the doctrine of frustration, not by an event referred to in the ‘frustration clause’ in the lease. 

1.6 Lease closure – surrender by deed (NL) 

The tenant surrenders the interest by way of deed and the landlord accepts. There is no prescribed form this can take but the landlord must consent to the surrender and evidence of this consent must be lodged. You will need to lodge a copy of the deed of surrender or other deed effecting the surrender. 

1.7 Lease closure – surrender by deed (not for value or reverse premium) (NL) 

As above, but not for value. 

1.8 Lease closure – surrender by deed (together with transfer) (TP) 

Use when surrender is being effected by a transfer. This transfers it to the reversionary estate (for example, to the landlord). 

Select, ‘Lease closure - surrender by deed (together with transfer)’ and, ‘Transfer’. Make sure the surrender is clear in the additional provisions panel, or by including a letter making it clear. 

The landlord must consent to the surrender.

Consent can be established by: 

• lodging a letter of consent or by the landlord (or their conveyancer) applying to close the registered leasehold title and/or cancel notice of the lease
• the deed (or duplicate deeds signed separately) being executed by both the landlord and tenant and incorporating wording along the following lines: 

“[Tenant] hereby [transfers and] surrenders to [landlord] the land comprised in the title above mentioned to the intent that the term of years granted by the [registered] lease may merge and be extinguished in the reversion thereof.”

or

“[Tenant] transfers and surrenders and releases to [landlord] all their estate and interest and rights in that part of the whole of the land comprised in the above title edged … on the annexed plan (‘the Surrendered Land’), to the intent that the residue of the term of years granted by the registered lease in so far as it relates to the Surrendered Land, and all or any other estate, interest or right of the Tenant in the Surrendered Land, whether granted by or arising from the registered lease or any deed or document supplemental to it or otherwise, is to merge and be extinguished in the reversion immediately expectant on the term of years granted by the registered lease.” 

1.9 Lease closure – surrender by deed (not for value or reverse premium) (TP) 

As above, but not for value. 

1.10 Lease closure – surrender by operation of law (TP/NL) 

This is to be used when there is implied surrender due to actions of both parties.  In most cases you will need to lodge a statutory declaration or statement of truth confirming: any consideration paid, that no deed of surrender was entered into, that premises have been vacated and if required, evidence to account for rent from any occupying under-lessee. 

1.11 Lease closure – surrender by operation of law (not for value or reverse premium) (TP/NL) 

As above, but not for value. 

2. Application details 

Lease closure transactions appear as either standalone register updates (see ‘standalone lease closure’ guidance) or can be added as additional titles on TPs or New Leases (see ‘new lease’ guidance). 

This guidance will focus on lease closure as part of a Transfer of Part application. 

Enter the closing leasehold titles as a ‘related’ title number. This captures a ‘dealing’ against the tenant titles. 

If only transferor or landlord titles are entered, the full list of lease closure options will not appear in the transaction list. 

Confirm the application affects the whole of the related title. 

2.1 Transaction selection and fee calculation 

Once a transfer (or assent) transaction is selected, you can select a lease closure as a later priority. 

The list of lease closures available with Transfer of Part (TP) is a smaller choice than those available as Register Updates (RU) (also known as Dealings). 

The fee will vary depending on the type of lease closure selected. 

2.2 Link transactions and titles 

The transactions are linked to title numbers. 

They are automatically linked where possible, but you may need to edit manually. 

You cannot use this for any subsequent onward transfer. You will have to apply for that against the new title created by the TP – you’ll get the new title number on submission of this application. 

2.3 Calculate fee 

Enter the relevant values and the fee is calculated automatically. Note that the fee for lease closure is not waived for any surrender by deed. 

2.4 Transaction details and attach documents 

Tenant and landlord details are required to populate the eAP1, as well as the transferee or transferor details as part of the transfer. 

Document prompts are dynamic and will populate based on the transaction. 

Some lease closures have no required documents, but a variety of suggested ones. 

The note of the lease will be automatically removed from the landlord’s title, you do not need to lodge a CN1 for this to be done. 

Where the required evidence is various, the, ‘Attach and certify document’, screen will have the list of options, as in the example to the right.