Can I break my lease without penalty in NSW?

Yes — but only if one of the specific legal grounds in the Residential Tenancies Act 2010 applies to your situation.

The general rule is that leaving a fixed-term agreement early costs money. Under section 107 of the Residential Tenancies Act 2010, the NSW Civil and Administrative Tribunal (NCAT) can order you to pay compensation for the loss your early exit causes. But the Act also lists specific situations where that liability disappears entirely.

This article explains each of those situations clearly.

The default: you usually pay to leave early

If none of the grounds below apply, leaving a fixed-term agreement before its end date will cost you. For agreements signed on or after 23 March 2020, the break fee is set by the Act based on how much of the tenancy has passed:

• Less than 25% complete: 4 weeks rent
• 25–50% complete: 3 weeks rent
• 50–75% complete: 2 weeks rent
• 75% or more complete: 1 week rent

This is in addition to any unpaid rent. For a fuller explanation of how the break-lease process works, see How do I break my lease early in NSW?

The sections below are the exceptions — the situations where the law removes your liability entirely.

If you are experiencing domestic or family violence

Under sections 105B and 105C of the Act, a tenant who is in circumstances of domestic violence can end the tenancy immediately. You do not need the landlord’s agreement, and the termination can take effect on the day you give the notice.

To use this pathway, you give the landlord (and each co-tenant, if any) a Domestic Violence Termination Notice. You must attach one of the following documents:

• a declaration by a competent person, made in the form prescribed by the Regulation. Competent persons include registered doctors and nurses, social workers registered with the Australian Association of Social Workers, employees of a government child-welfare agency, employees of a government-funded domestic violence or refuge service, and counsellors approved by the Commissioner of Victims Rights
• a copy of a provisional, interim, or final Domestic Violence Order (DVO), including Apprehended Domestic Violence Orders (ADVOs)
• a copy of a certificate of conviction for a domestic violence offence against the person named in the notice
• a copy of a Family Law Act injunction under section 68B or 114

Under section 105D, you are not required to pay a break fee or any compensation for leaving. Under section 213A, your landlord cannot list you on a tenancy database because you used this pathway. Under section 54A, you are not liable to the landlord for damage to the property caused by the offender during the commission of the domestic violence offence.

If your landlord has breached the agreement

The Act gives a tenant whose landlord has breached the agreement two separate pathways to end the tenancy without a break fee.

The first pathway is section 98. You give the landlord a written termination notice specifying a termination date at least 14 days after you give the notice. The date can be before the end of the fixed term. The landlord can apply to NCAT to challenge the notice — NCAT may revoke it if the landlord has remedied the breach and the Tribunal considers it appropriate to continue the tenancy.

The second pathway is section 103. If the breach is serious enough, you can apply directly to NCAT for a termination order without first giving the landlord a termination notice. NCAT must be satisfied the breach is serious enough to justify ending the tenancy. If it agrees, NCAT can order termination — and the order can take effect before the end of the fixed term.

A breach means the landlord has failed to meet an obligation under the agreement or the Act. Examples include failing to carry out urgent repairs, interfering with your quiet enjoyment, or not keeping the property in reasonable repair.

If a s98 notice takes effect unchallenged, or if termination is ordered under s103, you are not required to pay compensation for leaving early.

If key facts were withheld from you before you signed

Landlords must disclose certain “material facts” before you enter a tenancy agreement. This obligation comes from section 26 of the Residential Tenancies Act 2010, with the specific categories set out in the Residential Tenancies Regulation 2019.

Material facts are things that would affect a reasonable person’s decision to rent the property. The list includes:

• serious flooding or bushfire on the property in the last 5 years
• a serious violent crime committed on the property in the last 5 years
• a drug manufacture or cultivation offence on the property in the last 2 years
• the property being listed on the Loose-Fill Asbestos Insulation (LFAI) Register
• a proposed sale where a contract has been prepared
• mortgagee court proceedings to enforce a mortgage over the property
• fire safety or building rectification orders for combustible cladding
• strata scheme scheduled rectification work or major repairs (including replacement of roofing, guttering or fences) during your fixed term

If your landlord or their agent failed to disclose one of these facts before you signed, you may be able to apply to NCAT for orders — which can include termination of the agreement — under the Tribunal’s general orders power in section 187 of the Act. Giving at least 14 days written notice before leaving is advisable while any application is under way.

The failure must relate to the specific categories set out in the Act and Regulation. A general concern about the property — one not listed as a material fact — will not qualify.

If you have been offered social housing or aged care

Section 100 of the Residential Tenancies Act 2010 covers two specific life changes:

• you have been offered and accepted a social housing tenancy, or
• you need to move into a residential aged care facility or other approved care accommodation.

Under s100, you can end the tenancy without paying compensation. You must give at least 14 days written notice. You will need documentation to support the reason — such as a letter confirming your social housing offer or your aged care placement.

This ground applies whether you are in a fixed-term or periodic agreement.

If the property is destroyed or becomes uninhabitable

Section 109 of the Residential Tenancies Act 2010 covers the situation where residential premises are destroyed, become wholly or partly uninhabitable, cease to be lawfully usable as a residence, or are compulsorily acquired by an authority — through no breach by the tenant.

Either you or the landlord may give a termination notice, and the notice can end the agreement on the day it is given. There is no fixed notice period. Common triggers include fire damage, major flood damage, or a government authority ordering the premises to be vacated.

Because s109 is a lawful termination pathway (not abandonment under s107), you are not liable for the break-fee compensation set out in s107.

If the landlord has increased your rent on a longer lease

Section 99 of the Residential Tenancies Act 2010 gives you a no-penalty exit in one specific scenario:

• you are in a fixed-term agreement of 2 years or more, and
• the landlord increases your rent during that fixed term.

Under s99, you can end the tenancy without compensation. You must give at least 21 days written notice. The notice must be given before the rent increase takes effect — you cannot use this ground after you have already started paying the higher rent.

This ground reflects a clear principle. A tenant who committed to a long fixed term did so on the basis of a known rent. A mid-term increase changes that bargain, so the law allows you to leave.

If the landlord has given you a termination notice

Under section 110B of the Residential Tenancies Act 2010, if you are on a fixed-term agreement and your landlord gives you a termination notice — for example, because they intend to sell, move in themselves, or carry out major renovations — you have the right to leave earlier than the date on the landlord’s notice, without paying a break fee.

To use this pathway, you give the landlord an “early exit notice” specifying a date you will vacate. That date must be at least 14 days after you give the notice. You are not liable to pay rent for any period after both the date in your notice and the date you actually hand back vacant possession.

There are two exclusions. The early exit right does NOT apply if the landlord’s notice was given because you breached the agreement (section 87C) or because the property was destroyed or became uninhabitable (section 109). There is also a timing limit: you cannot give the early exit notice earlier than 60 days before the end of the agreement (for a fixed term of 6 months or less) or 90 days before the end of the agreement (otherwise).

For periodic tenancies, section 110A gives an even simpler right — the tenant can hand back vacant possession any time before the landlord’s termination date and stops owing rent from that point.

If none of these apply — hardship

If your situation does not fit any of the grounds above, you may still be able to apply to NCAT under section 104 of the Residential Tenancies Act 2010 for termination on grounds of undue hardship.

Hardship is not a penalty-free exit by default. Under s104, NCAT has the power to order termination, but it can also order you to pay compensation — capped at the amount of the applicable break fee under s107. The Tribunal weighs the circumstances of both the tenant and the landlord.

Hardship applications are assessed case by case. Serious illness, job loss, or a significant family change might be considered. There is no fixed list. Continue paying rent during the application — stopping rent payments will not help your case and may give the landlord additional grounds to claim compensation.

Wondering if your specific circumstances qualify?

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Documentation and giving notice

Whichever ground you rely on, keep a paper trail. Put your termination notice in writing. State the section of the Act you are relying on. Keep copies of all supporting documents — confirmation letters, court orders, repair requests, any relevant correspondence.

Giving proper written notice matters because it establishes the date your tenancy legally ends. If there is ever a dispute about your bond, your liability for rent after you vacated, or whether you left correctly, a clear written record protects you.

For information about getting your bond back after you leave, see How do I get my rental bond back in NSW?