Commercial Rent Arrears Recovery (CRAR): The Definitive Guide for Landlords

Quick Definition

Commercial Rent Arrears Recovery (CRAR) is a statutory process in England and Wales that allows landlords of purely commercial premises to recover at least seven days’ unpaid rent through certificated enforcement agents, without going to court.

Introduction

When tenants fall into arrears, landlords face immediate cashflow pressures. Taking a tenant to court can be costly and slow, while forfeiting a lease may not always be desirable.

That’s where Commercial Rent Arrears Recovery (CRAR) comes in. Since 2014, CRAR has given landlords a fast, effective, and legally robust way to recover unpaid rent only from commercial tenants.

This guide explains:

What CRAR is and where it comes from.
Who can use CRAR and in what circumstances.
A step-by-step breakdown of the process.
What can and can’t be recovered.
Risks and common mistakes.
Practical examples of how CRAR works in practice.

If you’re a commercial landlord, this article will help you understand how CRAR protects your rights and what to do next if your tenant stops paying.

What is CRAR?

CRAR (Commercial Rent Arrears Recovery) was introduced under the Tribunals, Courts and Enforcement Act 2007, Schedule 12 and came into force on 6 April 2014.

It replaced the old common-law remedy known as “distress for rent,” modernising the system and providing tenants with stronger legal protections.

The key principle of CRAR is simple:

If a commercial tenant owes at least seven days’ rent, a landlord can instruct a certificated enforcement agent to recover that rent by taking control of the tenant’s goods.

👉 Enforcement agents must follow the Taking Control of Goods Regulations 2013.

When Can CRAR Be Used?

CRAR is available to landlords only when specific conditions are met:

✅ Written lease: There must be a written lease in place. A licence to occupy is not sufficient.
✅ Commercial premises only: The lease must be solely commercial. If a property has residential use under the same lease, CRAR cannot be used.
✅ Tenant in occupation: The tenant must still occupy the premises. CRAR cannot be used if the tenant has vacated.
✅ Minimum arrears: At least seven days’ rent must be overdue.
✅ Certificated enforcement agent: Only trained, court-approved enforcement agents can carry out CRAR.

⚠️ CRAR cannot be used to recover:

Service charges
Insurance premiums
Business rates
Other lease-related payments

Step-by-Step: How CRAR Works

Here’s how the CRAR process unfolds:

Instruction
The landlord appoints a certificated enforcement agent. CRAR cannot be enforced directly by the landlord.
Notice of Enforcement
The enforcement agent serves the tenant with at least 7 clear days’ written notice before any attendance. This gives the tenant one last chance to settle.
Attendance at Premises
If payment is not made, the agent may enter the premises during business hours through a normal entry point (e.g. an unlocked door). Forced entry is not permitted at this stage.
Taking Control of Goods
The agent can seize goods belonging to the tenant, up to the value of the rent arrears plus fees. Certain goods are exempt, such as tools of trade worth up to £1,350.
Valuation & Auction
Seized goods must be valued and sold at public auction, with a further 7 days’ notice of sale provided to the tenant.
Distribution of Proceeds
Proceeds are used to cover arrears and enforcement fees. Any surplus is returned to the tenant.

For more details on what can be taken, see Gov.uk – Bailiffs: your rights.

What Can and Can’t Be Recovered Under CRAR?

✅ Rent: Only principal rent, plus VAT and interest, can be recovered.
❌ Not included: Service charges, insurance, repairs, or other sums due under the lease.

This distinction often surprises landlords. If you want to recover service charges or insurance arrears, a separate court claim may be necessary.

CRAR vs Other Landlord Remedies

Remedy	Speed	Cost	Effect on Lease	Covers	Best For
CRAR	Fast	Fees recoverable from tenant	Lease continues	Rent only	Quick recovery
Court claim	Slow (weeks–months)	Court & legal fees	Lease continues	All arrears	Broader claims
Forfeiture	Immediate	Legal costs	Lease ends	Rent & other breaches	Removing tenant
Negotiation	Variable	Low	Lease continues	Any arrears	Maintaining relationship

👉 Important: Using CRAR waives your right to forfeit the lease for those arrears.

Risks and Common Mistakes

❌ Attempting CRAR on mixed-use properties.
❌ Recovering non-rent sums under CRAR.
❌ Using an uncertified agent.
❌ Forgetting that CRAR blocks forfeiture rights for the same arrears.
❌ Not considering tenant insolvency rules.

Professional guidance avoids these pitfalls. See RICS – CRAR Guidance.

Case Studies: How CRAR Works in Practice

1. Tenant Pays After Notice

A landlord in Essex instructed Absolute Enforcement for £15,000 arrears. After receiving the 7-day notice, the tenant paid in full — avoiding enforcement visits or auction.

2. Tenant Refuses to Pay

A retail tenant owed £8,000. The enforcement agent attended the premises, seized stock, and arranged auction. The tenant settled on the morning of the sale, covering arrears and costs.

3. Tenant Insolvency

A tenant entered administration after arrears built up. Because insolvency law restricted enforcement, CRAR could not proceed. Instead, the landlord had to claim through the insolvency process.

These examples show CRAR is often effective — but not always. Timing and legal compliance are crucial.

FAQs on CRAR

What does CRAR stand for?
Commercial Rent Arrears Recovery.

How much rent must be owed before CRAR can be used?
At least 7 days’ rent.

Can CRAR be used if the tenant has left the property?
No — the tenant must still be in occupation.

Does CRAR cover service charges or insurance?
No — only principal rent, VAT, and interest.

Who pays the enforcement agent’s fees?
Fees are recovered from the tenant, usually through payment or sale of goods.

What happens if the tenant pays after the notice but before seizure?
The process stops immediately, and goods are not taken.

Can CRAR be used against sub-tenants?
In some cases, yes — sub-tenants may be required to pay rent directly to the superior landlord.

Why Choose Absolute Enforcement?

At Absolute Enforcement, we are specialists in Commercial Rent Arrears Recovery. Our certificated enforcement agents are highly experienced and operate professionally, lawfully, and quickly.

We understand that landlords want arrears resolved without unnecessary delay or risk. Our team provides clear advice, swift action, and proven results.

📞 Call us today on 0300 302 1010 for free advice on CRAR and landlord enforcement.