Navigating the complexities of retail leasing in Queensland requires a clear understanding of the financial obligations imposed on tenants. The Retail Shop Leases Act 1994 (Qld) (RSL Act) outlines specific restrictions on charges that landlords can impose. As a Brisbane-based commercial and property law firm, Ensure Legal is committed to helping business tenants comprehend these provisions to safeguard their interests.
Prohibited Charges Under the RSL Act
- Lease Preparation Costs
Landlords are prohibited from charging tenants for legal or other expenses related to the preparation of the lease. However, if a tenant requests the preparation of a lease and subsequently withdraws, they may be liable for the incurred costs. - Key Money
The Act forbids landlords from demanding key money—additional payments beyond rent and outgoings—as a condition for entering, renewing, or extending a lease. Such payments are recoverable by the tenant if made. - Option Renewal Costs
Tenants exercising an option to renew their lease should not be charged for the landlord’s legal or other expenses incurred in granting the renewal. - Mortgagee Consent Fees
Landlords cannot pass on costs associated with obtaining mortgagee consent for the lease to tenants. - Charges for Unprovided Services
Tenants should not be billed for services that are not available or not provided to them. - Sinking Fund Contributions
Total payments into a sinking fund for maintenance must not exceed 5% of the landlord’s estimated outgoings for the year. Additionally, landlords must not accept payments that would cause the fund to exceed $100,000.
Permissible Charges
While certain charges are restricted, tenants may still be responsible for:
- Up to one month’s rent in advance
- A repayable bond
- Shop fit-out costs paid by the landlord
- Survey and registration fees
- Interest on arrears of rent or outgoings
- Damages for breach of lease terms
- Costs reasonably incurred by the landlord in consenting to a lease assignment
- Legal costs for consenting to a sublease or lease variation requested by the tenant
Understanding Outgoings
Under Section 37 of the RSL Act, tenants are not liable to pay an amount for outgoings unless the lease specifies:
- The outgoings payable by the tenant
- How the outgoings will be determined and apportioned to the tenant
- How the outgoings may be recovered by the landlord from the tenant
Contact Us
If you’re facing challenges related to lease charges or need assistance understanding your rights under the RSL Act, contact Ensure Legal today. Our experienced team is dedicated to providing tailored legal solutions to meet your specific needs.
