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Social housing tenants are not normally permitted to sublet their properties. Where it is discovered that they have, an Unlawful Profits Order (UPO) can be made to recover any profit made by the tenant. This is normally based on the difference between the rent charged to the subtenant and the rent the tenant pays to the landlord.
Where a UPO is granted after an application by the landlord, that is not the end of the matter for the tenant, as a recent case shows. It dealt with a tenant who unlawfully sublet his London flat. He was ordered to pay £14,700 in respect of the unlawful profit, plus the legal costs, as well as making good rent arrears of more than £5,000 after the local council brought proceedings on behalf of the housing authority.
However, the sting in the tail for the tenant was that the landlord was also granted a possession order over the property.
Failure to adhere to the terms of your lease can lead to a number of problems, as this case illustrates. In another case, a tenant who sublet his flat using an online short-term letting service was also put through a court case when the landlord took successful action to prevent the practice.