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Your tenant wants to sublet or transfer their lease — what are your rights? That's exactly the kind of thing Almost Passive covers every week.
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It's more common than you might think: a tenant reaches out to say they want to move out early and asks if someone else can take over the unit. Sometimes they say "sublet," sometimes "transfer the lease." The distinction matters — legally and practically — and your rights in each case are different.
Ontario's Residential Tenancies Act gives you real input on who occupies your property. But the rules have deadlines, and ignoring a request can backfire badly. This guide covers everything you need to know.
Subletting vs. Assignment: What's the Difference?
These two terms are often used interchangeably, but under the Residential Tenancies Act they mean very different things and trigger different legal processes.
A sublet is temporary. The original tenant moves out for a period, lets someone else live in the unit, and plans to return before the lease ends. The original tenant remains on the lease throughout and is still legally responsible for rent and any damage. The person staying there — called the subtenant — has an arrangement with the original tenant, not directly with you.
An assignment is permanent. The original tenant wants to transfer the lease entirely to someone new. After a valid assignment, the assignee becomes your tenant and the original tenant is no longer party to the tenancy.
Understanding which one is being requested is the first step. It changes your response, your options, and the process that follows.
| Sublet | Assignment | |
|---|---|---|
| Original tenant leaves | Temporarily | Permanently |
| Original tenant responsible for rent? | Yes | No (after completion) |
| Who your tenant is afterward | Original tenant | Assignee |
| Can you refuse outright? | Not for legitimate reasons | Yes — but tenant can then give 30 days' notice |
| How long for you to respond | 7 days | 7 days |
The Landlord's Rights: Consent Required, But Not Unreasonably Withheld
For both subletting and assignment, the tenant must get your consent in writing before proceeding. They should make the request in writing, and you have 7 days to respond from when you receive it.
If you don't respond within 7 days, you are deemed to have given consent. Not responding is not a safe option.
Here's the part most landlords don't know: you cannot unreasonably withhold consent. The RTA sets the standard. You can refuse a specific subtenant or assignee for legitimate reasons — poor credit history, a pattern of non-payment on their record, or income that doesn't meet your reasonable criteria. But you cannot refuse simply because you'd prefer the unit back, want to choose someone yourself from scratch, or don't like the general idea of someone different living there.
If you refuse without good reason, the tenant can apply to the LTB, and the board can authorize the sublet or assignment without your consent.
When You Can Refuse Outright
For assignment requests, there is one situation where you can decline entirely: you can refuse the assignment and instead offer to let the tenant terminate the lease early.
Under the RTA, if you refuse an assignment (for any reason), the tenant has the right to give you 30 days' notice and end the tenancy. This creates a clean exit for both parties: the tenant leaves without breaking the lease, and you can start fresh with a new tenant of your choosing.
This option applies only to assignments, not sublets. For a sublet request, you must evaluate the specific proposed subtenant — you cannot refuse the concept of a sublet and simply terminate the tenancy.
How to Screen the Proposed Occupant
When a tenant brings you a proposed subtenant or assignee, you have the right to evaluate them the same way you would any applicant. Use your standard screening process:
What to request:
- Government-issued photo ID
- Proof of employment (recent pay stubs, offer letter, or employer contact)
- Credit check authorization and report
- Two references — ideally a prior landlord and an employer
- Written answers to your standard application questions
What you can legally consider:
- Credit score and payment history
- Employment stability and income (typically 2.5–3x monthly rent is a standard benchmark)
- Prior landlord references and rental history
- Identity verification
What you cannot consider:
- Race, ancestry, place of origin, colour, ethnic origin
- Citizenship or immigration status
- Age (except where housing is designated for a specific age group)
- Family status, sex, gender identity, sexual orientation
- Disability, receipt of public assistance, record of offences
These protected grounds apply to your screening of any proposed occupant — subtenant or assignee — just as they do for any new tenant application. Document your reasons if you decline, and make sure those reasons are based on the legitimate criteria above.
Practical Steps When You Receive a Request
1. Get it in writing. Ask for a written request that includes the proposed subtenant or assignee's name. If the tenant's request comes by text, respond in writing and confirm you've received it. Your 7-day response window starts from receipt.
2. Request the same screening package you'd require from any new applicant. The tenant should provide you with documentation for the proposed occupant. If they can't, that's a valid reason to ask for more time.
3. Screen them using your normal criteria. Run a credit check with their written authorization. Check references. Verify employment. If the proposed occupant doesn't meet your usual criteria, document your specific reasons clearly in writing.
4. Respond within 7 days. Approve or decline in writing, keep a copy, and make sure the method of delivery is one you can prove. Email is ideal — it creates a timestamp and a record.
5. If you approve, get the arrangement in writing. For a sublet, the key documents are: the sublease agreement between the original tenant and subtenant, and a written acknowledgment that the original tenant remains responsible for rent and damage throughout. For an assignment, you'll want a written assignment agreement signed by all three parties — you, the original tenant, and the assignee.
What a Proper Assignment Looks Like
An assignment transfers the lease from the original tenant to the assignee. After a properly executed assignment:
- The assignee steps into the original tenant's legal position
- The original lease terms continue — the same rent, the same rules, the same fixed-term end date (if any)
- You cannot use the assignment as an opportunity to increase the rent or require a new lease on different terms
- The original tenant's last month's rent deposit transfers to cover the assignee's tenancy
A written assignment agreement should include:
- The names of all parties (landlord, outgoing tenant, incoming assignee)
- The property address
- The effective date of the assignment
- The ongoing rent amount
- A statement that the assignee accepts all terms of the existing lease
- Signatures from all parties
You do not have to create a brand-new lease. The existing lease continues — the assignment document simply substitutes the tenant. For a guide on what the original lease should contain, see How to Write a Lease Agreement in Ontario.
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What If a Tenant Sublets Without Permission?
If a tenant sublets without getting your written consent first, you can serve an N5 Notice to End a Tenancy for unauthorized subletting (grounds: "unauthorized occupant" or interference with reasonable enjoyment — depending on the specific situation).
The N5 gives the tenant 7 days to correct the situation — typically by ending the unauthorized sublet or removing the unauthorized occupant. If they correct the problem within 7 days, the N5 is void and the tenancy continues.
If the tenant receives a second N5 within six months for the same or a similar breach, you can file an L2 application at the LTB without another 7-day correction window.
Acting promptly matters. Allowing an unauthorized sublet to continue without a formal response can weaken your legal position if the matter later reaches the LTB — it may appear that you tacitly accepted the situation.
Common Mistakes Landlords Make With Sublets and Assignments
Ignoring the request. If you don't respond within 7 days, you are legally deemed to have consented. Silence is not neutrality — it's consent under the RTA. Even if you want more time to think, respond in writing within 7 days to request additional information.
Refusing without documented reasons. "I just want the unit back" is not a legally valid reason to refuse a sublet or assignment. If you refuse without clear, documented justification based on the proposed occupant's actual qualifications, you risk an LTB application that overrides your refusal — and potentially an order for costs.
Not screening the proposed occupant. The RTA requires you not to unreasonably withhold consent, but it does not require you to accept anyone the tenant proposes. Screen them properly. A subtenant who doesn't pay still leaves you chasing the original tenant for the money — which is better than nothing, but harder than not having the problem in the first place.
Treating a sublet as an opportunity to raise rent. You cannot use either a sublet or an assignment to increase the rent above what the original tenant was paying, outside of normal guideline increases. The incoming occupant takes the tenancy on the existing terms.
Not getting the assignment in writing. An assignment that isn't properly documented creates confusion about who the legal tenant is, who the deposit belongs to, and who you communicate with going forward. Get all three parties to sign.
Allowing a sublet to become a permanent occupancy. If the original tenant never returns and the subtenant stays indefinitely, the situation can evolve into something legally murky. If the original tenant abandons the tenancy, there are separate RTA processes for dealing with that. See our guide to abandoned tenancy in Ontario for the correct steps.
Local Context: London, St. Thomas, and Strathroy
Sublet and assignment requests tend to come up most with students (relocating between academic years), tenants who've had a job change, and people who've found a better living situation elsewhere.
In London especially — with a significant student population near Western University and Fanshawe College — lease transfers between student tenants mid-year are common. The incoming occupant is often a friend or classmate. Even in these informal arrangements, the formal consent process protects you. Without it, you have an unauthorized occupant whose tenancy rights you don't control.
If a proposed subtenant is actually planning to run a short-term rental operation out of your unit, that's a separate problem. See the guide to Airbnb and short-term rentals in Ontario for how to address that situation.
For London landlords with a City of London Rental Housing Licence, note that licences cover specific units and landlords — not occupants — so a change in occupancy through a valid assignment doesn't affect your licence standing. But if an unauthorized occupant causes a property standards issue that triggers an inspection, you bear responsibility as the licence holder.
When Professional Management Helps
Sublet and assignment requests have tight timelines, require proper documentation, and create legal exposure if handled incorrectly. This is an area where property managers add clear value: screening proposed occupants, responding within the 7-day legal window, preparing proper assignment documentation, and managing the transition without disruption to your rent flow.
If you're managing multiple properties or regularly dealing with tenant turnover requests, see what full-service property management costs in London. A manager who handles this routinely has the screening process, document templates, and LTB knowledge to get it right the first time.
Frequently Asked Questions
What is the difference between subletting and assignment in Ontario? Subletting is temporary — the original tenant moves out for a period, lets someone else occupy the unit, and plans to return before the lease ends. The original tenant remains legally responsible throughout. Assignment is permanent — the original tenant transfers the lease entirely to a new person, who becomes your tenant going forward.
Does an Ontario tenant need the landlord's permission to sublet? Yes. Both subletting and assignment require the landlord's written consent under the RTA. The tenant must make the request in writing, and the landlord has 7 days to respond. Failing to respond within 7 days is deemed consent — so never let a request sit unanswered.
Can a landlord refuse a sublet or assignment request in Ontario? You can refuse a specific subtenant or assignee for legitimate reasons — poor credit, income that doesn't meet your criteria, or a history of non-payment. You cannot refuse simply to get the unit back or to select someone yourself from scratch. If you refuse without documented, legitimate reasons, the tenant can apply to the LTB, which can authorize the sublet or assignment over your objection.
What happens if a landlord refuses an assignment request? For assignments specifically, you can refuse and instead allow the tenant to terminate the tenancy early by giving 30 days' notice. This can work well for both parties — the tenant exits cleanly, and you can select a new tenant from scratch. This option applies only to assignments, not sublets.
Can a landlord charge a fee to consent to a sublet or assignment? No. You cannot charge any fee for reviewing the request, screening the proposed occupant, or granting consent. Any such charge would be unlawful under the RTA.
What can a landlord do if a tenant sublets without permission? If a tenant sublets without your consent, you can serve an N5 notice (unauthorized subletting or unauthorized occupant). The tenant has 7 days to correct the situation. If they don't correct it, or if it happens again within 6 months, you can file an L2 application with the LTB. Act promptly — allowing an unauthorized sublet to continue without a response can weaken your legal position.
Can the new tenant be required to sign a new lease? Not for a valid assignment. The assignee takes the existing lease on its current terms. You cannot use the assignment to change rent, add new rules, or require a new deposit. A new lease would only apply if the original tenancy ends and a truly new tenancy begins.
Does the last month's rent deposit transfer in an assignment? Yes. The original tenant's last month's rent deposit carries over to cover the assignee's last month. You don't need to collect a new deposit, and the original tenant's deposit is not returned to them — it transfers to the incoming tenant's benefit.
Key Takeaways
- Subletting = temporary; original tenant stays legally responsible. Assignment = permanent transfer of the tenancy.
- Tenants need your written consent before doing either — and you have 7 days to respond.
- Silence is deemed consent. Always respond in writing within 7 days.
- You can't unreasonably withhold consent, but you can screen the proposed occupant using your normal criteria.
- For assignments: if you refuse (for any reason), the tenant can give 30 days' notice and exit the tenancy cleanly.
- Unauthorized subletting can be addressed with an N5 notice — act promptly.
- Document every step: the request, your screening, your response, and any agreement.
If you're managing sublet or assignment requests across multiple properties and the documentation and deadlines are getting complicated, Prospera Properties handles the full process for London, St. Thomas, and Strathroy landlords. Reach out or see what management covers.