The North Carolina sublease agreement is a legal contract that allows a tenant to rent out all or a portion of the property to a subtenant in exchange for regular payments.
Does a Tenant Need the Landlord’s Permission to Sublet in North Carolina?
In North Carolina, a tenant does need a landlord’s explicit written permission to sublet. Even after consent is given, a landlord still has the right to reject a subtenant if they are unqualified, such as for having a prior eviction or poor references.
Standardized North Carolina Sublease Agreements
A standard form can be used in North Carolina to create a sublease. Here’s what is generally included in a North Carolina sublease agreement:
- The Names of the Parties – The original tenant under the lease is named in the sublease and is called the “Sublessor.” The third-party that is subleasing the rental unit is named in the sublease and is called the “Sublessee.”
- Rental Unit Location – The address for the rental unit as described in the original lease.
- Term – State the dates of when the sublease begins and ends.
- Rent – How much the rent is, when it needs to be paid, and how to pay it.
- Landlord’s Consent – This section describes how the landlord is asked to consent (if consent is not already included in the Master Lease). Tenants may create a signed sublease that is conditional on being accepted by the landlord before the sublease becomes effective.
- Liability – The sublessee will be liable for any damages to the Sublessor. The Sublessor is responsible for paying for any damages that impact the landlord as stated in the original lease agreement.
- General Conditions – A statement that the written sublease agreement contains all of the agreements between the parties and can only be modified by written consent of the parties to the agreement.
- Authorized Occupants – This identifies the new tenant(s) and those authorized to live in the rental unit including any policy about short-term guests.
- Disputes – A description of how disputes between the Sublessor and Sublessee are to be settled, which may include mediation and binding arbitration to avoid more expensive legal proceedings.
- Master Lease Inclusion – A copy of the Master Lease is attached to the sublease. If any exceptions in the Master Lease are not included they should be clearly stated in this section.
- Security Deposit – The maximum security deposit depends on the length of the lease. Leases longer than month-to-month can only charge 2 months’ rent, month-to-month can charge up to 1.5 months’ rent, and week-to-week can charge up to 2 weeks’ rent. The security deposit is held by the Sublessor (not the landlord).
- Return of Security Deposit – Landlords in North Carolina must return a security deposit within 30 days from the date the tenant vacates the unit if there are no deductions.
- Lead-Based Paint Notice – Under Federal law, if the rental unit’s premises were built before 1978, the Sublessee must be given a written warning notice, called a Lead-Based Paint Disclosure.
- Inventory of Included Items – The list of items in the rental unit that are part of the sublease (furniture or appliances).
- Utilities – The utilities to be paid by the Sublessor and those that are to be paid by the Sublessee.
- Smoking Policy – If smoking is restricted in the rental unit, any designated smoking areas are identified in the sublease.
- Parking Policy – List designated areas where subtenants and their guests may park and include information about any parking fees.
- Signature: The signature and date for the Sublessor, the Sublessee, any Co-Sublessors, and Co-Sublessees (if they exist).
Tax Implications of a Sublease in North Carolina
In North Carolina, a sublessor may be subject to taxes if they sublet a property for any period of 90 days or less. For example, in Charlotte, taxes may include:
- North Carolina State Sales Tax – 4.75%
- Mecklenburg County Tax – 2%
- Mecklenburg Co Public Transportation Tax – 0.5%
