Your Subtenant Stopped Paying — Are You Still on the Hook to the Landlord?

Renting a flat and then subletting rooms to other people for a margin is common in Hong Kong, especially in subdivided-flat and co-living setups. The problem starts when your subtenant stops paying. The instinctive reaction for a lot of head tenants — commonly called "second landlords" (二房東) — is: "well, I'll just pay the landlord a bit less too, since I'm not collecting the full amount anyway." That instinct is exactly what turns you into the party who owes the landlord rent, adding a risk you didn't need to take on.

This guide draws on public materials from the Community Legal Information Centre (CLIC) and the Hong Kong Judiciary to explain how liability actually splits between a head tenant and a subtenant, what you can and can't do when your subtenant defaults, how to protect yourself before subletting again, and what happens to a subtenant when the head tenancy itself ends.

You Are Actually Signed Onto Two Completely Separate Contracts

Most head tenants think of the arrangement as one continuous chain — landlord, head tenant, subtenant, all tied to one flow of rent. Legally, it is actually two completely separate contracts: the head tenancy between you and the landlord, and the sub-tenancy agreement between you and your subtenant. The terms, the duration, even the rent amount can differ entirely between the two.

Per CLIC, subletting means "a tenant lets the property, or part of it, to another person under a separate sub-tenancy agreement" — in other words, the sub-tenancy is a new contract sitting outside the head tenancy, not an extension or part of it. That sounds simple, but it's exactly the blind spot most head tenants only discover after something goes wrong: the landlord is not a party to the sub-tenancy. The landlord has no contractual relationship with your subtenant, and generally cannot (and will not) pursue the subtenant directly for rent — as far as the landlord is concerned, there is only one person who owes rent: you, the person who signed the head tenancy.

Can You Pay the Landlord Less When Your Subtenant Defaults?

The answer is: no. Your full rent obligation to the landlord does not automatically shrink just because your subtenant hasn't paid — this follows directly from the "two separate contracts" point above. What you owe the landlord is calculated from the head tenancy's own rent figure and payment schedule, entirely independent of how much your subtenant has actually paid you, or whether they've paid at all.

In practice, plenty of head tenants reason: "since I'm not collecting the full amount from my subtenant anyway, I'll pay the landlord a bit less this month and chase the subtenant later." The risk here: if the landlord decides to pursue you, they pursue you for the full rent stated in the head tenancy — regardless of what happened on your subletting side. In other words, whatever shortfall you pass on to the landlord gets treated as your own default under the head tenancy, not as something you're entitled to split off onto your subtenant. If it reaches the Small Claims Tribunal, "my subtenant didn't pay me" generally won't work as a defence in the landlord's claim against you — because there is no contract between the landlord and your subtenant for that defence to attach to.

For the landlord's side of recovering unpaid rent from a tenant (i.e. the position you're in here), see What Can a Landlord Do When a Tenant Falls Behind on Rent. And if your head tenancy also has a guarantor, What Are You Actually Liable For As a Rent Guarantor is worth reading too — the underlying logic, that each contract stands on its own, is the same one at work here.

Recovering What Your Subtenant Owes You

Because the two contracts are separate, recovering the shortfall from your subtenant is its own, entirely separate claim, unrelated to whatever you owe the landlord — you don't need to wait until you've recovered from the subtenant before paying the landlord, and you don't need to resolve one before pursuing the other. The two can (and should) proceed in parallel.

In practice, this claim is against your subtenant, based on the sub-tenancy agreement you both signed — what you're recovering is the gap between the rent figure stated in the sub-tenancy and what the subtenant actually paid. If the amount is HK$75,000 or less, you can bring this to the Small Claims Tribunal, using broadly the same approach a landlord uses against a defaulting tenant: gather the sub-tenancy agreement, rent receipts or transfer records, and copies of any demand letters to prove exactly how much the subtenant owes you.

Note that this claim is unaffected by any arrears you personally owe the landlord — meaning even if you're still behind on your own payments to the landlord, you can pursue your separate claim against the subtenant at the same time. There's no required order where one has to be resolved before the other.

Protecting Yourself Before You Sublet Again

If you haven't started subletting yet, or your current subtenant has left and you're looking for a new one, work through these before signing anything:

• Always use a written sub-tenancy agreement — don't rely on a verbal understanding or a WhatsApp exchange. The rent amount, payment date, and deposit amount all need to be in writing, so you have something to point to if a dispute arises later
• Set the deposit high enough to cover at least one month's shortfall — the moment a subtenant defaults, your deposit is your first line of buffer. Too small a deposit means no real buffer at all
• Check whether your head tenancy expressly bans subletting. Per CLIC, a tenancy must contain "an express clause" to prohibit subletting; if your head tenancy has no such clause, subletting itself generally isn't a breach — but if it does, subletting without approval can put you in direct breach of the head tenancy with the landlord. That is a completely separate risk from "the subtenant defaulted," and it's worth confirming before you sublet at all
• Consider the subtenant's stability and background. No screening step fully eliminates the risk of a default, but basic checks (identity documents, reliable contact details) are still better than none

These steps look basic, but subletting arrangements in subdivided flats and co-living setups tend to get informal or purely verbal — and when something goes wrong, the side without a written record is usually the one who loses out.

What Happens to the Subtenant When the Head Tenancy Ends?

This question can come up in three different situations: your own arrears cause the landlord to terminate the head tenancy, the landlord declines to renew it, or the fixed term simply expires. All three lead to the same outcome — per CLIC, once the head tenancy becomes invalid or is terminated, the leasehold estate under the sub-tenancy is destroyed along with it. The subtenant has "no legal right or interest to possess and occupy the property," and must hand it back to the landlord, even if the subtenant has done nothing wrong and has paid every cent owed under the sub-tenancy.

This is a risk head tenants often overlook: trouble between you and the landlord flows straight down to your subtenant, even when the problem is entirely on your side and has nothing to do with them. Getting your own obligations to the landlord right from the start — including keeping up with payments rather than using "I'll pay once I recover from my subtenant" as an excuse to delay — isn't just protecting yourself. In a real sense, it also protects your subtenant from being forced out over a problem that was never theirs.

Claiming at the Small Claims Tribunal — Procedure and Amount

Per the Hong Kong Judiciary, the Small Claims Tribunal handles monetary claims not exceeding HK$75,000, covering claims arising from contract — recovering a shortfall from your subtenant falls within this. Filing fees are tiered by claim amount: HK$20 for claims up to HK$5,000; HK$40 for HK$5,001–25,000; HK$70 for HK$25,001–50,000; and HK$120 for HK$50,001–75,000.

Forms 1 and 2 must be filed at the Tribunal Registry in person — post, fax and email are not accepted. Having your sub-tenancy agreement, rent receipts or transfer records, and copies of demand letters ready before filing will make the process considerably smoother. For the full filing procedure and hearing arrangements, see The Complete Guide to the Small Claims Tribunal.

If you win but your subtenant still won't pay, you can apply for a Writ of Fieri Facias, which lets you seize and sell the debtor's goods to satisfy the judgment, at a filing cost of HK$55 plus watchman and transport expenses — see How to Enforce a Small Claims Tribunal Judgment After Winning for the full process. If you'd like help from start to finish — organising evidence through to filing — see how our filing assistance service can help; you can also browse more rent-arrears recovery cases.