Your tenant refuses the rent increase you proposed at renewal? You have three options, all legal. You can apply to Québec's rental board (the TAL) to have the rent fixed within the deadline set by law — but the increase granted is often modest. You can negotiate a mutual agreement that works for both sides. Or, if the gap with the market is large, you can agree on a paid voluntary departure, then re-rent the unit at its fair value. What you can never do is force, threaten, or evict the tenant. Here's how to choose.
In this article
What actually happens when a tenant refuses
First, a fact that surprises many landlords: a refusal doesn't force the tenant to leave, and it doesn't strip you of recourse. At lease renewal, you send a notice of modification (including a rent increase) within the deadline set by law. The tenant then has a period — usually about one month — to respond: if they say nothing, they are deemed to have accepted; if they refuse in writing, they can either leave the unit or stay.
The case that concerns you is the one where they refuse the increase but choose to stay. In that situation, the lease renews — but on the old conditions, meaning at the current rent, unless you act. The ball is in your court: it's up to you to decide which path to take, and quickly, because some recourses have a strict deadline.
Key takeaway
A tenant who refuses the increase and stays keeps their current rent by default. To obtain an increase anyway, it's up to you to act: the law opens several doors, but none of them involves imposing anything.
Option 1 — Rent fixing at the TAL
The "official" route: after receiving the tenant's written refusal, you can file an application to fix the rent at the TAL, within the deadline set by law (generally about one month following the refusal). If you let that deadline pass, the lease renews automatically at the current rent — you lose the increase for the year. Meeting the deadline is therefore critical.
The TAL then fixes the rent according to its own calculation method, framed by the Civil Code and the applicable regulation. That method draws on the real change in the building's expenses: municipal and school taxes, insurance, energy costs, maintenance, and eligible major work. In other words, the increase reflects the change in your costs, not the market value of the unit.
The direct consequence: the amount granted is often modest, especially if the rent lags far below market. Rent fixing gives you a defensible, legally solid increase, but it caps your gain. It's the right path when the gap with the market is small; it's a frustrating one when that gap is several hundred dollars a month.
Option 2 — The negotiated agreement (cash for raise)
Rather than accept the cap of rent fixing, you can negotiate directly with the tenant an agreement that works for both parties. Because it rests on mutual consent and not on the TAL's method, it isn't capped: the tenant can accept a higher rent, or a staged increase, in exchange for something of value to them — improvements to the unit, some flexibility on the terms, or a signing incentive.
This is the principle of "cash for raise": you turn a standoff into a win-win proposal. Done well, an agreement closes faster than a TAL file and can far exceed the amount a rent fixing would have granted. Its only condition: it requires the tenant's yes. For the concrete steps, see our guide "Raising a tenant's rent in Québec."
Option 3 — A paid voluntary departure, then re-rent at market
When the gap between the current rent and the market rent is large, the most profitable path isn't to increase this particular tenant: it's to agree on a paid voluntary departure, then re-rent the unit at its fair value. You pay the tenant compensation to end the lease by mutual agreement; once the unit is vacant, a new lease sets a market rent — capturing the entire gap, well beyond what a rent fixing would have produced.
This is "cash for keys": a mutually agreed termination, perfectly legal, explained in detail in our complete cash for keys guide. The math is often spectacular, because the value of an income property depends on its net income: every dollar of rent recovered at market multiplies the value of the asset. To grasp the scale of what's at stake, read "Below-market rents: the hidden fortune in your building."
Comparing your options: speed, amount, effort
All three paths are legitimate; they simply don't aim at the same result. This table sets them side by side.
| Rent fixing at the TAL | Negotiated agreement | Paid voluntary departure | |
|---|---|---|---|
| Tenant's consent | Not required: the TAL decides | Required: they agree | Required: they agree to leave |
| Cap on the gain | Limited to the TAL's method | Negotiable, not capped | Market rent on re-rental |
| Speed | Slow: filing and hearing | Fast if the tenant is open | A few weeks once agreed |
| Cost / effort | Administrative process | Negotiation, sometimes an incentive | Compensation paid upfront |
| Ideal when | The market gap is small | The tenant is open to talking | The market gap is large |
What you can never do
Refusing an increase is a tenant's right, not a provocation. The reflex to "apply pressure" isn't just counterproductive: it's illegal and can cost you dearly.
- Threaten or intimidate the tenant so they accept or leave.
- Harass with repeated visits, calls, or messages.
- Cut off or reduce services (heating, hot water, maintenance) to push them out.
- Trigger disruptive work or make the unit unlivable.
- Evict a tenant in good standing without a recognized legal ground.
Which option should you choose?
The right path comes down to a single number: the gap between the current rent and the market rent.
- Small gap? Rent fixing at the TAL is often enough — just make sure to meet the deadline after the refusal.
- Tenant open to talking? A negotiated agreement goes further, faster, without going through the tribunal.
- Large gap? A paid voluntary departure, followed by a re-rental at market, captures value that neither rent fixing nor a simple increase can reach.
The hard part is accurately assessing that gap and choosing the most profitable path without ever crossing the line of legality. That's exactly what we do: the analysis is free and, with our pay-only-for-results model, you pay only if the deal closes.
This article is provided for informational purposes and does not constitute legal advice. The TAL's rules and deadlines evolve — always confirm the applicable terms or consult a professional before acting.