A break clause allows either the landlord or tenant to end a tenancy before the end of the fixed term by serving notice in writing. The amount of notice that must be served will be dependent on what has been written into the tenancy agreement.
Break clauses are agreed by both parties before the tenancy starts and are put in the contract. For both landlords and tenants this means if their circumstances change they are legally able to end the agreement early, as long as the notice is served correctly and there are no breaches of the tenancy agreement. Neither party should suffer any financial repercussions, unless the tenancy agreement states otherwise. This would also have to be agreed before the start of the tenancy.
If a landlord wants to end an assured shorthold tenancy (AST) at the end of the fixed term or during a statutory periodic tenancy, meaning when an AST continues after the end of the fixed term and the tenancy rolls on as a new fixed term isn’t agreed, then they must serve a minimum of two months’ notice.
As a tenant, if you do not have a break clause and would like to leave your tenancy early you are normally liable to compensate the landlord or find replacement tenants and pay any costs incurred in doing so.
It is worth noting that break clauses are not automatically placed into tenancy agreements and they are not standard practice. Many landlords prefer a fixed term to avoid having to find new tenants regularly and they also help to protect tenants who can’t afford the costs of frequent moving.