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As a business owner, you are likely to come across leases. Sometimes you must complete your lease registration with the HM Land Registry, and sometimes only voluntary registration on the land register applies. You must know when this land registration rule applies to a property transaction. In particular, registration with the land registry protects you as the tenant. This article will explain when you should register a lease regarding a property with the land registry and the verification of identity process through an ID1 form.
What Does it Mean to Register a Lease?
To register a lease means to file information on it with HM Land Registry on the land register. Registering a lease with the land registry gives your lease the formal legal status of a ‘legal estate’.
You will need to complete sections of the Leasehold Title Register for registration, such as short particulars, which include:
- date of creation;
- length of lease, which is the term;
- rent due; and
- names of parties.
Lease registration takes place to protect you as the tenant. If the ownership of the property changes, the new owner must uphold the lease agreement. If it is registered, your level of security as a tenant increases.
When to Register a Lease
Sometimes it is compulsory to register a lease, and at other times, it is voluntary. You will usually need to register your commercial lease for at least seven years. Where it is less than this, you will unlikely need to. However, there are times when this does not apply. For example, where the lease was created before registration was compulsory. Also, If you have already registered a lease and then you transfer it, you will need to register it again.
If your lease is old (meaning it was created before 2006) but still has over seven years left, you can voluntarily decide to register it. However, there should not have been any disposition, meaning no sale or mortgage. You can also note a lease in the Land Registry next to the landlord’s title.
When registering with the Land Registry, you must present the original lease, which both you and your landlord must sign. You can only register a lease upon completion of the lease agreement and must do so within two months of the leasehold estate purchase. If you do not, your legal title will fall to the person who assigned it to you – the assignor. Although it may be possible to register your lease late, there is no guarantee. Also, if you do, you will likely need to create a new lease and incur the costs.
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What is Verification of Identity?
If you are unrepresented in the leasing transaction when you register with the Land Registry, you will need to prove your identity for them to verify. To do this, you should fill in an Application form ID1. You must do this for up to three months before registering the lease with the Land Registry.
This legal form carries a maximum penalty of 10 years imprisonment if you purposely fill it in incorrectly. Therefore, you must complete it with care. Also, if you make a mistake on the form, your lease registration may not be accepted.
The form asks for information such as:
- your current address;
- how long you have lived there; and
- addresses you have resided at over the past five years.
It is necessary to complete this form to ensure that registration fraud does not occur. After completing Section A of the form, you must verify your identity with a conveyancer or a Chartered Legal Executive.
Alternatively, your lawyer will ordinarily verify your identity as part of their assisting you.
Key Takeaways
You must understand when to register a lease with the Land Registry. Usually, when a lease is over seven years, you will need to, but there are some exceptions. There are also times when you can choose to register a lease.
To register a lease, you need your identity verified. This is important because it helps to protect against fraud. Verification occurs through an ID1 form which you must complete correctly. If you do not, you may be unable to register. Furthermore, if you purposely complete it incorrectly, you could face up to ten years in prison.
If you need help understanding when to register a lease or verify identity in the UK, our experienced leasing lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents for a low monthly fee. So call us today on 0808 196 8584 or visit our membership page.
Frequently Asked Questions
When registering a lease, you must do so with the Land Registry.
As the lease tenant, you are responsible for the lease registration, and you must register the lease as it protects you as a tenant.
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