Commercial Rent Arrears Recovery (CRAR) Explained

Several of those conditions are stricter than most tenants assume, and each is worth checking before accepting that CRAR was available at all.

This page sets out what CRAR is, which leases actually qualify, the arrears threshold that has to be met, what counts as recoverable rent, and the notice and entry rules that apply. For the wider question of how enforcement against a business differs generally, including company versus sole trader liability, see bailiffs and your business. For a council's own route against unpaid business rates, which is a different power entirely, see business rates bailiffs.

What CRAR actually is

CRAR gives a commercial landlord the right to use the same taking control of goods procedure that applies elsewhere on this site, but exercised on the landlord's own authority rather than under a court judgment or a council liability order. It replaced the old common law right to distrain for rent, which was abolished outright rather than reformed, so a landlord's letter that still talks about "distress" or "distraining goods" is describing a power that no longer exists. An enforcement agent instructed under CRAR must be authorised in writing by the landlord and must comply with the same Schedule 12 procedure, the same conduct rules and the same complaint routes as any other enforcement agent.

Only a genuinely commercial lease qualifies

Two conditions have to be met before CRAR is available at all, and both catch people out. First, the lease must be evidenced in writing. An informal arrangement that was never properly documented, or a tenancy at sufferance rather than a true lease, falls outside CRAR altogether, whatever the landlord's paperwork calls it. Second, the premises must be genuinely commercial, meaning none of the demised premises is let, or actually occupied, as a dwelling. This is a strict test, not a majority-use test: where a unit is mixed use, such as a shop with a flat above let under the same lease, or living accommodation attached to trading premises, the presence of any dwelling use within the demised premises can take the whole lease outside CRAR, not just the residential part. A landlord who wrongly treats a mixed-use letting as purely commercial is exposed to a challenge on this point alone.

The arrears threshold, checked twice

CRAR can only be used where the net unpaid rent is at least seven days' rent, and that threshold is not a one-off check. It must be met immediately before notice of enforcement is given, and it must be met again immediately before goods are first taken control of. If the tenant pays enough between those two points to bring the arrears below seven days' rent, CRAR stops being available for that debt, even though notice has already been served. Net unpaid rent means the rent that has fallen due, less any interest or VAT included in it and less any permitted deduction the tenant could lawfully claim against that rent, so a tenant who has a genuine set off or recoupment argument can use it to reduce the figure the threshold is measured against.

What counts as rent, and what does not

CRAR recovers rent in a narrow, defined sense, and the definition matters because commercial leases routinely bundle several charges together under a single "rent" heading. What CRAR can recover is the amount payable for possession and use of the premises itself, plus any interest the lease allows on that amount and any VAT chargeable on it. What it cannot recover, whatever the lease calls it, is service charge, insurance, repairs, maintenance, rates or council tax, or any other ancillary sum. A landlord pursuing CRAR over a service charge shortfall, or an insurance premium recharged to the tenant, is pursuing something CRAR was never designed to reach, and a tenant facing that should ask the landlord to identify precisely how much of the sum claimed is principal rent as against everything else.

Notice, and why entry stops short of force

Notice of enforcement under CRAR must give the tenant at least 14 clear days before goods can be taken control of, the same minimum period that applies across most enforcement work since 1 May 2026, with a Sunday, bank holiday, Good Friday or Christmas Day not counting towards it. The 28 clear day extension that can apply where an individual debtor gets a qualifying debt advice request in before the notice period ends does not apply to a non-eligible business debt, and a CRAR debt, being commercial rent owed by a business tenant, will not usually qualify for that extension.

A point worth knowing precisely: CRAR carries no forced entry power at all. The only premises an agent can enter under CRAR are the demised premises themselves, and entry must be by a usual door or usual means, such as a loading bay. The four gateways that let an enforcement agent use reasonable force to get in cover criminal fines, business premises enforced under a High Court or county court judgment, and re-entry after a broken controlled goods agreement, and none of them is CRAR. In practical terms, a tenant who simply does not open the door to a CRAR agent has not committed any offence by doing so, and the agent has no lawful means of forcing that door, unlike the position that can apply where the same business premises are being enforced against for an actual court judgment debt.

What happens if the lease ends or is forfeited

CRAR is tied to the lease being enforced under, so once the lease itself ends, CRAR generally stops being available for that tenancy. There is a narrow exception that can preserve CRAR for rent that fell due before the lease ended, but only where the lease ended some other way, such as by expiry or surrender, and not by forfeiture, and only for six months, and only while broadly the same landlord and tenant relationship continues. Where a lease has been forfeited, a tenant should not assume the arrears simply disappear, since a landlord can usually still bring an ordinary debt claim for rent already due, but that is a different route from CRAR, and a landlord who wants to preserve the option of forfeiture needs separate legal advice on how pursuing CRAR might interact with that.

Challenging or stopping CRAR

A tenant who disputes CRAR being used can apply to the court for an order setting aside the notice of enforcement, or for an order that no further step can be taken under CRAR without a further court order. That route exists specifically because CRAR is exercised without a prior court hearing, so the tenant's opportunity to be heard, if there is a genuine dispute about the rent claimed, its certainty, or whether a permitted deduction should reduce it, comes after notice is given rather than before. Short of court proceedings, the more common routes are paying enough to bring the net unpaid rent below the threshold, agreeing a controlled goods agreement once goods have been taken control of, or querying the landlord's figures directly where a bundled charge looks like it includes service charge or insurance rather than pure rent.

The key point

CRAR is a landlord's own remedy, not a court judgment power, and three verified conditions decide whether it can be used at all: the lease must be genuinely commercial with no dwelling use anywhere in the demised premises, the net unpaid rent must clear a seven day threshold both at notice and at the point goods are first taken, and the sum recoverable is limited to principal rent plus interest and VAT, never service charge, insurance or other ancillary costs. Entry itself is peaceable only, with no forced entry power built into CRAR at all, which is a real and useful distinction from enforcement against the same premises under a High Court or county court judgment.