How do I break my lease early in NSW?

You can break your lease early in NSW — but whether you pay a break fee depends on your reason for leaving and when your lease was signed.

Breaking a lease mid-term is stressful. You need to know two things: whether you qualify to leave without a financial penalty, and if not, how much you’ll owe. This guide covers both, step by step.

The two paths — with grounds or without

NSW law gives you two routes out of a fixed-term lease.

The first is a grounds-based exit. If your situation matches one of the specific grounds in the Residential Tenancies Act 2010, you can leave without paying a break fee.

The second is a no-grounds exit. If none of those grounds apply, you can still leave — but you’ll owe a fixed break fee set by law.

For periodic tenancies (week-to-week or month-to-month), you can give written notice at any time under section 97 of the Residential Tenancies Act 2010. That notice must specify a termination date at least 21 days after you give it (s97).

If you have grounds — exits without a break fee

These grounds let you end a fixed-term lease early without paying the break fee. Section 100 of the Act includes several no-compensation grounds — the ones covered below are the most commonly relied on, but the section contains other grounds too (for example, if the property is on the loose-fill asbestos insulation register under s100(1)(b1)).

Landlord has breached the agreement — section 98

If your landlord has broken a term of the lease (for example, failing to make urgent repairs), you can give a written termination notice under section 98 of the Residential Tenancies Act 2010. The notice must specify a termination date at least 14 days after you give it (s98).

Be aware: using this ground unilaterally carries risk. The landlord can dispute your termination at NCAT, and if the Tribunal finds the breach wasn’t serious enough to justify termination, you could be treated as having abandoned the tenancy and be liable for compensation. For borderline or contested breach situations, it can be safer to apply directly to NCAT for a termination order under section 103 of the Residential Tenancies Act 2010 — that way the Tribunal decides whether the breach warrants termination before you leave.

Rent increase on a long-term lease — section 99

If you are in a fixed-term agreement of 2 years or more and the landlord has issued a rent increase notice, you may give a termination notice under s99. The notice must specify a termination date at least 21 days after you give it, and must be given before the rent increase takes effect (s99). Section 99(5) makes clear the tenant is not liable for any compensation for the early termination.

Social housing offer or aged care placement — section 100

Under section 100 of the Residential Tenancies Act 2010, you can leave without penalty if:

• you have accepted an offer of social housing premises (s100(1)(a)), or
• you have accepted a place in an aged care facility, or you need care in one (s100(1)(b)).

The termination notice must specify a date at least 14 days after you give it (s100).

Landlord plans to sell — and didn’t tell you — section 100

If your landlord notifies you they intend to sell the property, and they did not disclose that plan before you signed the agreement, you can also terminate under s100(1)(c) without penalty. The same 14-day minimum notice period applies (s100).

Domestic violence — section 105B

If you or a dependent child are in circumstances of domestic violence, you can give a domestic violence termination notice under section 105B of the Residential Tenancies Act 2010. The notice can specify a termination date on or after the day it is given — meaning you do not need to wait (s105B, s105C). Section 105D makes clear that you are not liable for any break fee or other compensation for the early termination.

You must give the notice to the landlord and to each co-tenant.

Special hardship — section 104

If you cannot satisfy any other ground but would suffer serious hardship by staying, you can apply to the NSW Civil and Administrative Tribunal (NCAT — the body that hears tenancy disputes) for a termination order under section 104 of the Residential Tenancies Act 2010. You do not need to give the landlord a termination notice before applying (s104). The Tribunal decides whether your circumstances justify early termination.

Note: hardship is not automatically cost-free. Under s104(2) the Tribunal may still order the tenant to pay compensation to the landlord — capped at the fixed break-fee amount set by s107. So a s104 exit is often cheaper than a full no-grounds break fee, but not always zero.

If you don’t have grounds — the fixed break-fee schedule

If none of the above apply, you can still leave — but you’ll pay a break fee.

For fixed-term leases of 3 years or less signed on or after 23 March 2020, the break fee is capped by law under section 107(4) of the Residential Tenancies Act 2010. The amount depends on how much of your fixed term has already passed:

How much of your lease has passed	Break fee
Less than 25%	4 weeks rent
25% or more, but less than 50%	3 weeks rent
50% or more, but less than 75%	2 weeks rent
75% or more	1 week rent

These amounts are the maximum the landlord can claim under s107 for a no-grounds break of a sub-3-year fixed-term lease signed on or after 23 March 2020. The break fee is the only amount the landlord can claim for the early termination itself — a landlord or agent cannot charge you the break fee AND ongoing rent until a new tenant is found AND advertising or re-letting fees on top. If you’re handed a bill that stacks these charges, it’s not what s107 allows.

The law also does not set a minimum notice period for a no-grounds termination where you’re paying the fixed break fee. You are liable for rent up to the day you return vacant possession (see the section 110 explanation below), but no separate 14- or 21-day notice window applies on top of that.

Leases over 3 years signed after 23 March 2020 are outside the fixed schedule under s107(2). The landlord may negotiate a compensation amount with you, or apply to NCAT.

Leases signed before 23 March 2020 are under the old scheme. Some old agreements included an optional break-fee clause; where none applied, the landlord could claim their actual reasonable losses (lost rent, advertising, letting fees) through NCAT. Check your original agreement for a break-fee clause, and contact NSW Fair Trading if you’re unsure which scheme applies to you.

What section 110 does

Section 110 of the Residential Tenancies Act 2010 makes a tenant who has given a termination notice liable for rent up to the termination date on the notice — this applies to any termination notice, not just no-grounds exits. In practice this means: even if you’re leaving under one of the no-compensation grounds above, you still owe rent up to the date on your notice. Grounds like s99(5), s100(4), or s105D zero out any additional compensation on top of that rent — they don’t waive the rent owing up to the termination date itself.

How to actually give notice

All termination notices must be in writing. They must specify the termination date — that is, the date you are ending the tenancy.

The minimum notice periods differ by ground:

• Landlord breach (s98): at least 14 days
• Rent increase on long-term lease (s99): at least 21 days, before the increase takes effect
• Social housing / aged care / landlord selling (s100): at least 14 days
• Domestic violence (s105B/s105C): can be the same day you give the notice

Keep a copy of every notice you give, and a record of how and when you delivered it. If the landlord disputes your grounds, you may need to show NCAT exactly what you sent and when.

What happens to your bond

Breaking a lease does not automatically mean you lose your bond. The bond covers damage, unpaid rent, and cleaning — not the break fee itself.

Your landlord must lodge any bond claim through NSW Fair Trading within a set timeframe after you vacate. If you disagree with what they claim, you can dispute it.

For a simple explanation of the process, see how to get your rental bond back in NSW and what a landlord can deduct from your bond in NSW. If a dispute does arise, how to dispute a bond claim in NSW walks you through NCAT.

The break fee and the bond are separate. Even if you pay the break fee in full, your landlord can still make a legitimate claim on your bond for damage or unpaid rent — and vice versa.

Not sure if your situation qualifies for a penalty-free exit?

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