If you’re a landlord considering renting out a room in your home or a tenant exploring rental options, understanding the difference between a lodger and a tenant is key. Each arrangement offers benefits, and the right choice depends on your priorities — flexibility, security, or long-term rental income.
Taking in a lodger can be a simple way to generate rental income while sharing your home, whereas renting to a tenant provides stability and a more structured agreement. Both options come with different responsibilities, legal protections, and tax considerations.
This guide breaks down the differences so you can make an informed decision that suits your needs.
What is a lodger?
A lodger rents a room in a property where the landlord also lives. This arrangement is known as lodging and is typically set up with a licence to occupy rather than a tenancy agreement.
Lodgers share communal spaces like the kitchen and bathroom with the landlord. Unlike tenants, they do not have exclusive possession of any part of the property, meaning the landlord can access their room if needed while respecting privacy.
For landlords, hosting a lodger can be a straightforward way to earn rental income while maintaining flexibility over their home. Lodgers often pay a fixed rent that includes bills, making the arrangement simple.
Landlords may also benefit from the Rent a Room Scheme, which allows them to earn up to £7,500 tax-free per year from renting out a furnished room in their home.
What is a tenant?
A tenant rents part or all of a property but has exclusive possession of their living space. This means the landlord cannot enter without permission, even if they own the property.
Most tenants sign an Assured Shorthold Tenancy (AST), which provides stronger legal protections for both parties. This includes:
- Deposit protection – landlords must place deposits in a government-backed scheme
- Formal eviction rules – tenants cannot be asked to leave without legal notice
- Privacy laws – landlords must provide notice before accessing the property
Unlike lodgers, tenants are usually responsible for paying council tax and utility bills unless the tenancy agreement states otherwise. Renting to tenants provides landlords with long-term stability and structured rental income, making it an attractive option for those with an investment property.
Related: Can landlords ask for rent in advance?
Lodger vs tenant: key differences for landlords
The biggest distinction between a lodger and a tenant is exclusive possession.
A tenant has full control over their rented space, whereas a lodger shares the home with the landlord.
Here’s what landlords need to know:
- Agreements – Tenants sign an AST, while lodgers have a licence to occupy
- Deposit Protection – Tenants’ deposits must be legally protected; lodgers’ do not
- Eviction Rules – Lodgers can be asked to leave with reasonable notice, while tenants require a formal legal eviction process
- Council Tax – Tenants usually pay this themselves; landlords cover it for lodgers
- Privacy – Landlords can enter a lodger’s room but not a tenant’s space without permission
Both options have their advantages:
- If you want simplicity and flexibility, taking in a lodger may be ideal
- If you prefer long-term rental income with legal protections, a tenant arrangement may be better
It’s essential to choose the setup that aligns with your property goals and lifestyle.
Can a tenant become a lodger?
Yes, this can happen if a landlord moves into a property where a tenant already lives.
In this case, the tenant may no longer have exclusive possession, and their status could change to a lodger. If this happens, it’s important to:
- Update the agreement to reflect the new arrangement
- Clarify privacy and access rules
- Ensure compliance with legal requirements
This transition should be carefully managed to avoid misunderstandings or disputes. Seeking legal advice can help ensure the change is handled smoothly.
Related: What is subletting?
Council Tax and other landlord responsibilities for lodgers
For landlords renting to a lodger, the responsibility for council tax remains with the landlord. However, if the landlord only has one lodger, they may qualify for a 25% single-person discount.
Utility bills are often included in the lodger’s rent, making billing simpler and more predictable for both parties.
Does a lodger agreement need to be in writing?
While lodger agreements don’t have to be in writing, having one is highly recommended. A clear agreement ensures both parties understand their rights and responsibilities.
A lodger agreement should include:
- Rent amount and payment schedule
- What’s included in the rent (bills, council tax, etc.)
- Notice periods for ending the agreement
- House rules (guests, smoking, pets, etc.)
Creating a written agreement helps prevent misunderstandings and provides clarity for both landlords and lodgers.
How do the rental law changes affect landlords?
The Renters’ Rights Bill, expected to become law in 2025, will introduce significant reforms to tenancy law, including:
- Abolishing Section 21 evictions – landlords must provide a valid reason for eviction
- Introducing a single system of periodic tenancies – fixed-term agreements will be replaced with rolling periodic tenancies
- Higher property standards – all rental homes must meet the Decent Homes Standard
- Rent increase regulations – landlords will only be permitted to raise rents once a year, and any increase must align with market rates
However, these reforms only apply to tenants, not lodgers. If you take in a lodger, you retain complete control over notice periods, eviction processes, and rental terms.
For landlords looking for a simple, flexible rental arrangement, taking in a lodger can be a great option.
Which option is best for landlords?
For landlords, choosing between a lodger or tenant depends on your goals. Both options have advantages, and choosing the right one depends on your property type, financial goals, and how involved you want to be in the rental process.
If you’re still unsure which option is right for you, consulting with a letting agent or legal expert can provide clarity and ensure you’re compliant with UK rental laws.
Whichever option you choose, having a clear agreement and understanding of your responsibilities will help create a smooth and successful rental experience. Why not discuss options with your local Whitegates branch today?
