Licence To Alter Cost In The UK: What Tenants Should Expect

If you’re fitting out a shop, office or studio in a leased space, you’ll usually need your landlord’s permission before making changes. That permission is formalised in a “Licence to Alter”.

It’s a standard step in most commercial leases - but the costs can surprise first‑time tenants.

In this guide, we break down typical Licence to Alter costs in the UK, who pays what, the legal rules on “reasonable” conditions, and practical ways to keep your budget under control while staying compliant.

What Is A Licence To Alter (And When Do You Need One)?

A Licence to Alter is a formal, legally binding permission from your landlord allowing you to carry out works to the leased premises. It’s normally drafted as a deed and sits alongside your lease.

You’ll generally need a Licence to Alter for any works that are more than purely decorative. Think structural changes, opening up walls, moving services, changing layouts, installing new shopfronts or signage, heavy plant, or anything that could impact the building’s structure, services, fire strategy or other occupiers.

Most modern commercial leases divide works into categories (often “structural/non-structural” or “major/minor”). Even for “non-structural” alterations, many leases still require consent, which must not be unreasonably withheld. Always check the alterations clause in your lease before planning works - or get a quick Commercial Lease Review so you know exactly what’s allowed and what it’ll cost to get permission.

Because a Licence to Alter is a deed, you’ll need to sign and complete it correctly. If you’re not familiar with deeds, it’s worth reading up on executing contracts and deeds to avoid delays on completion day.

What Does A Licence To Alter Cost In The UK?

Costs vary with the complexity of your fit‑out, the building and the landlord’s requirements. However, most tenants should plan for the following categories. All figures below are indicative and exclude VAT unless noted.

Typical Landlord Recoverable Fees

• Landlord’s legal fees: commonly £1,000–£3,000+ for a straightforward licence; £3,000–£6,000+ where works are complex (e.g. structural, impact on plant, listed buildings).
• Landlord’s surveyor/engineer fees: typically £750–£2,500+ for review and monitoring; can be higher if multiple site visits or structural review is needed.
• Admin/processing fee: sometimes a fixed “management” charge (e.g. £250–£750) in multi‑let buildings.

Your Own Professional Costs

• Your legal fees: budgeting £1,000–£3,000+ is common, depending on drafting, negotiation and the number of rounds of revisions.
• Your designer/architect/engineer: drawing packages, method statements and compliance advice can range from £1,500–£10,000+ depending on scope.

Third‑Party Approvals And Compliance

• Building control sign‑off: approved inspector or local authority fees can run from £300–£1,500+.
• Planning permission/advertisement consent (e.g. new shopfront or signage): application fees are usually modest (often £200–£500), but design/professional time adds to cost.
• Party Wall surveyor(s): if the Party Wall etc. Act 1996 applies, allow £1,000–£3,000+ per surveyor (you may need to cover the adjoining owner’s surveyor too).

Security And Ongoing Costs

• Security deposit or bond: landlords sometimes require a works bond (e.g. £2,000–£10,000) refunded on satisfactory completion/reinstatement.
• Additional insurance: works insurance or evidence of public liability/contractor insurance; premiums vary by project value.
• Premium: in rare cases (usually for structural alterations that enhance the landlord’s asset), the landlord may seek a premium for consenting. For most tenant fit‑outs that don’t increase rental value or harm reversion, a premium isn’t typical.

On a modest retail or office fit‑out with no structural works, a ballpark total for “consent costs” (landlord’s fees + your legal/surveyor + approvals) might be £3,000–£8,000. For complex, structural or listed‑building works, £10,000–£25,000+ isn’t unusual - and that’s before your actual build cost.

Good budgeting includes contingency. Allow at least 10–15% on top for unforeseen technical queries, extra drawings, or additional monitoring visits.

Who Pays For What? Legal Rules On Fees And Conditions

Most commercial leases say you must get the landlord’s consent and “pay their proper and reasonable costs” of considering your application and preparing the licence. That’s reinforced by section 19(2) of the Landlord and Tenant Act 1927, which allows a landlord to attach conditions to consent, including the payment of their “reasonable expenses” in connection with the application.

Key points to understand:

• Consent must not be unreasonably withheld or delayed. If your works are reasonable and you supply proper information, the landlord should progress consent within a sensible timeframe.
• “Reasonable expenses” means the landlord’s actual legal and surveyor costs that are proper for the work in question - not a profit centre. Excessive hourly rates, duplicated review, or costs unrelated to your works may be challengeable.
• Reasonable conditions can include: providing drawings/specs and method statements; appointing competent and insured contractors; giving a programme of works; complying with building regs, fire safety and health and safety law; and reinstating at lease end (or sooner if requested).
• You will normally be liable for any damage caused and for making good on completion. Expect to provide a schedule of condition to avoid disputes about what “making good” means.

If you’re negotiating a new lease, this is the moment to cap or clarify alteration consent costs. A clear cap (e.g. “the tenant will pay the landlord’s legal and surveyor costs up to £X plus VAT for non‑structural works”) can save arguments later. It’s worth having those caps built into your lease during a Commercial Lease Review - or a retail lease review if you’re in a shopping centre or high street unit.

How To Budget And Keep Licence To Alter Costs Down

There are smart ways to manage the process so costs don’t run away from you.

1) Nail Your Scope Upfront

Incomplete or changing plans are the biggest driver of extra reviews and fees. Provide a clean package the first time:

• Scaled drawings and a scope of works (highlight structural or services changes).
• Method statements and risk assessments (RAMS) for noisy or intrusive works.
• Evidence of contractor competence and insurance.
• Fire strategy impacts (door ratings, detection, means of escape) and any asbestos assumptions.

If you’re engaging suppliers to install specialist kit, ensure your contract covers design responsibility and compliance; for supply-and-install packages, a tailored Supply and Install Agreement is often worth having.

2) Ask For A Fee Cap (Early)

Before the landlord’s advisors start work, ask to agree a cap for their legal and surveyor fees for your category of works. Reasonable landlords will set a sensible cap with scope for uplift if the scope changes materially.

3) Keep It Non‑Structural Where Possible

Structural works mean more scrutiny, monitoring and cost. If you can achieve your layout goals with demountable partitions, raised floors, or by routing services within your demise without adding load or penetrating slabs, your consent will typically be simpler and cheaper.

4) Align With Building Rules

Multi‑let buildings often have Tenant Fit‑Out Guides and building standards. Ask for these on day one and design within them to avoid rework and extra consultant time. Make sure your contractors understand CDM Regulations, method statements, permits to work and the building’s rules on noisy works, deliveries and waste.

5) Sequence Approvals To Avoid Re‑draws

Coordinate landlord consent with planning/building control so you don’t have to resubmit drawings twice. Where planning is needed (e.g. signage or shopfront), confirm the principle with the landlord first, then submit both applications with consistent drawings.

6) Get The Right Contracts In Place

For design-and-build or multiple trades, clear contracts reduce risk and queries. Our plain‑English construction contracts guide covers what to include. If you’re appointing a principal contractor, make sure roles and liabilities are clear in a proper agreement, rather than piecemeal emails.

7) Agree Reinstatement Now (Not At Lease End)

Confirm in the licence which items must be removed at lease end and what can remain. Attach a photo schedule of condition. This avoids costly disputes (and last‑minute works) when you exit.

Process, Documents And Compliance Checks

Most landlords follow a similar sequence. Here’s what to expect and how to stay compliant.

Step 1: Check Your Lease And Engage Your Team

Confirm if the works are allowed in principle and whether consent can be subject to conditions. Line up your designer/engineer and contractors, and speak to a lawyer about the licence draft. If the permissions regime in the lease needs changing (for example, to allow specific works or agreed caps), that may require a Deed of Variation or side letter alongside the licence.

Step 2: Prepare And Submit Your Application

Include drawings, a scope, method statements, insurances, programme and any third‑party approvals you will seek. If intrusive works are proposed, expect to appoint an independent surveyor to liaise with the landlord’s team.

Step 3: Negotiate The Licence Terms

Typical points include working hours, building access, protection of common parts, insurance, monitoring, reinstatement and “as built” records. The document will be by deed, so ensure correct execution blocks and signatories are used in line with UK rules for signing deeds.

Step 4: Carry Out The Works Safely And Lawfully

You must comply with health and safety law, including CDM Regulations, and any building fire strategy. Make sure risk assessments and method statements are in place, contractors are competent and insured, and site rules are followed. Our overview of health and safety in the workplace is a useful starting point for responsibilities during works.

Step 5: Completion, Sign‑Off And Records

On completion, you may need to provide “as built” drawings, test certificates and building control sign‑off. The landlord’s surveyor may inspect to release any bond. Keep everything with your lease pack - it’ll be invaluable if you later consider assigning your lease or negotiating a rent review.

Key Documents You’ll Typically See

• Licence to Alter (deed) with plans attached.
• Contract(s) with your fit‑out contractor(s). For turnkey installs, consider a robust Supply and Install Agreement to allocate design and compliance responsibilities.
• Method statements, RAMS, proof of insurance and competence.
• Fire strategy notes, building control approvals, completion certificates.
• Schedule of condition and, if relevant, party wall awards.

Key Takeaways

• Plan for a Licence to Alter wherever your fit‑out goes beyond decorative works; most commercial leases require landlord consent by deed.
• Expect to pay the landlord’s “reasonable” legal and surveyor costs, plus your own professional fees; straightforward licences often total £3,000–£8,000, while complex/structural works can be £10,000–£25,000+.
• Section 19(2) of the Landlord and Tenant Act 1927 lets landlords attach reasonable conditions (including paying their expenses), but consent must not be unreasonably withheld or delayed.
• Control costs by nailing the scope early, keeping works non‑structural where possible, asking for fee caps, aligning with building standards and sequencing approvals sensibly.
• Get your paperwork right: clear construction contracts, proper deed execution, schedules of condition and “as built” records will save headaches later (especially if you assign the lease).
• If your lease is still being negotiated, use that moment to agree cost caps and a pragmatic alterations regime - a targeted Commercial Lease Review can pay for itself quickly.

If you’d like help negotiating a Licence to Alter, capping fees in your lease, or putting the right contracts in place for your fit‑out, you can reach us on 08081347754 or team@sprintlaw.co.uk for a free, no‑obligations chat.