Returning the property before the end of the term: is there a penalty? How is it calculated?

Handing the property back before the end of the term? Estimate what is owed in the lease termination penalty calculator and see what the statute requires in our guide to Brazilian tenancy law.

Life changes — a new job in another city, buying your own home, a change of plans — and suddenly you need to leave the rented property before the end of the term. The first question is always the same: will I pay a penalty? How much? Many tenants end up paying the full penalty without knowing that, in most cases, it should be much lower.

In this guide, you will understand whether there is a penalty for returning the property before the end of the term, how it is calculated proportionally, in which cases there is a full waiver (such as a job transfer), and why formalizing a termination agreement is the safest way to end the lease — all in accordance with the Tenancy Act.

Can I return the property before the end of the contract?

Yes. The tenant may hand the property back before the agreed term — the law does not require them to stay until the end. But, as a rule, this early exit triggers a penalty, set out in the lease (Lei 8.245/1991, art. 4).

The big question — and the one that causes the most loss through misinformation — is the amount of that penalty. As a rule, it is not the “full” penalty: it is proportional to the time remaining until the contract ends. The closer to the end the tenant leaves, the lower the penalty. Understanding this is what prevents paying far more than is due.

How is the penalty for leaving before the end of the term calculated?

The rule is proportionality. The contractual penalty is reduced according to the period of the contract already served (art. 4 of Lei 8.245/1991, together with art. 413 of the Brazilian Civil Code, which requires reducing the penalty when the obligation has been partially performed).

An example makes it clear: suppose a 30-month contract with a penalty of three months' rent for early exit. If the tenant leaves halfway through the term (15 months served), they pay about half the penalty — and not the full three months' rent. If they leave with only a few months remaining, the penalty is even lower. The exact calculation depends on the clause and the time remaining, but the logic is always the same: the more you have served, the less you pay. That is why charging the full penalty, ignoring the time already served, is usually improper — and can be challenged.

Is there any case where no penalty is paid?

Yes — and it is a valuable exception. A tenant transferred by their employer to work in another location is exempt from the penalty, provided they notify the landlord in writing at least 30 days in advance (art. 4, sole paragraph, of Lei 8.245/1991).

This scenario protects those who need to move for work reasons, beyond their control. Outside it, the rule is the proportional penalty. There is also another way to remove or reduce the penalty: the amicable termination agreement. By agreement between landlord and tenant, it is perfectly possible to arrange the waiver or reduction of the penalty — something common when the landlord already has a new tenant lined up, for example. Negotiating is usually better for both sides than ending in conflict.

Why formalize a termination agreement?

The termination agreement is the agreement by which landlord and tenant end the lease by mutual consent. A good termination agreement sets out: the move-out date, the settlement of amounts (including any proportional penalty), the condition of the property (with an inspection), and the return of the security (security deposit).

A termination agreement in writing helps record accepted and disputed amounts, the handover of keys, the inspection and the scope of any release. It does not eliminate every dispute, and a mutually signed agreement is not an absolute requirement for a lawful unilateral handover. If the landlord unjustifiably refuses the keys, obtain advice on documenting or formally depositing them through the appropriate procedure. A cash deposit settlement must include justified deductions and legally applicable earnings.

Hypothetical example: Mariana's job transfer

In a hypothetical example, Mariana rents an apartment in São Paulo for 30 months and is transferred by her current employer to another city in month ten. The agency demands the full penalty of three months' rent. Before accepting it, she needs to check the clause, the reason for leaving and the transfer documents.

If the move results from that employer-directed transfer, and Mariana proves it and gives written notice at least 30 days in advance, she can claim the waiver under article 4, sole paragraph. A new job offer alone is not an employer transfer. Without a waiver, under the ordinary regime in this example, the 20 months remaining out of 30 produce a penalty of 3 × 20/30 = two months' rent. The inspection, keys, outstanding charges and deposit balance must be documented and assessed; full repayment cannot be assumed. This is an illustration, not a client result.

The most common (and costly) mistakes

• Paying the full penalty. In most cases, the penalty is proportional to the remaining term — much lower.

• Being unaware of the waiver for a job transfer. With the correct notice, there is no penalty.

• Leaving without a termination agreement. This opens the door to surprise charges for damage or debts.

• Not carrying out a move-out inspection. Without it, proving the condition of the property can become harder.

• Accepting improper deductions from the security deposit. The security deposit may only cover real and documented debts.

Checklist: for returning the property before the end of the term

• Inform the landlord of your intention to leave (in writing).

• Check whether there is a waiver of the penalty (e.g., job transfer) and give 30 days' notice.

• Calculate the penalty proportional to the time remaining (do not accept the improper full one).

• Carry out the move-out inspection and record the condition of the property.

• Formalize a termination agreement with the settlement of amounts and the return of the security deposit.

• Rely on a real estate lawyer to avoid loss.

Frequently asked questions about returning the property before the end of the term

Can I return the property before the end of the contract?

Yes. Under the general rule in article 4 of Law 8,245/1991, the agreed penalty is proportional to the remaining term, subject to waivers and special regimes. If no penalty was agreed, a court may determine it. Built-to-suit leases follow article 54-A(2). Document the handover of keys and any outstanding amounts.

How is the penalty for leaving before the end of the term calculated?

The contractual penalty is reduced in proportion to the period already served (art. 4 of Lei 8.245/1991, together with art. 413 of the Brazilian Civil Code). Example: with a penalty of three months' rent on a 30-month contract, if the tenant leaves halfway through, they pay roughly half — and not the full three months' rent. The exact calculation depends on the clause and the time remaining. That is why the “full” penalty charged without proportion is usually improper.

Is there any case where I do not pay a penalty when leaving before the end of the term?

Yes. A move resulting from a transfer by a public or private employer to a location different from that at the start of the lease allows a waiver if the landlord receives at least 30 days' written notice (article 4, sole paragraph). A new job offer does not automatically qualify. Contractual waivers, agreements and other grounds require case-specific assessment.

What is a lease termination agreement?

It is an agreement by which landlord and tenant end the lease by consent and record the handover date, inspection, penalty, debts and security. It helps reduce uncertainty but cannot prevent every dispute. Both parties' signatures are not an absolute requirement for a lawful unilateral handover; refusal of the keys calls for advice on evidence or an appropriate formal deposit procedure.

How can I return a rented property in São Paulo without taking a loss?

Review the lease, give written notice, check the penalty or waiver, document the inspection and keys, and assess debts and the deposit balance. These steps reduce risks but do not guarantee a cost-free exit. Indefinite-term leases follow article 6: at least 30 days' written notice is required; without it, one month's rent and charges may be claimed, separately from fixed-term early-exit penalties.

Do I need a lawyer to leave a rental contract before the end of the term?

A lawyer is not mandatory for an ordinary handover or out-of-court agreement. Advice can help with disputed penalties, employer transfers, repairs, deposits and refusal of keys. The review considers both parties' obligations and does not guarantee a waiver or specific outcome.

Leaving before the end of the term need not be expensive

Returning the property before the end of the contract is a tenant's right — and, in most cases, it does not cost the full penalty that many pay out of misinformation. The penalty is proportional to the time remaining, there is a full waiver for those transferred for work, and an amicable termination agreement can reduce or remove the amount, as well as ending the lease without loose ends.

The secret is to know these rules before accepting any charge — and to formalize the exit with notice, inspection, and a termination agreement. That way, the tenant avoids loss and the landlord receives only what is due.

At Falchet e Marques Sociedade de Advogados, a firm in São Paulo (Av. Paulista), we work in real estate law and leasing — calculating the correct penalty, negotiating termination agreements, and guiding tenants and landlords through the end of the lease. If you need to leave (or take back) a property before the end of the term, it is worth understanding your rights well.

Talk to our team on WhatsApp: +55 11 95901-1854 — and request a review of the lease and the amounts claimed.

If no penalty was agreed, article 4 allows the court to determine it. Nonresidential built-to-suit leases follow article 54-A(2): the agreed penalty cannot exceed the rent remaining until expiry, and the ordinary calculation should not be applied automatically. An indefinite-term lease instead follows article 6: at least 30 days' written notice is required; without it, one month's rent and charges may be claimed. Contractual waivers, agreements and landlord breaches require separate analysis.