Almost every tenancy agreement has a clause in it that bans sub-letting. But this doesn’t stop tenants from sub-letting the property. My advice to a Landlord who discovers that their property has been sub-let is to take action to evict anyone found to be sub-letting. Otherwise, if the tenant has sub-let the property to two different households comprising three people then it makes it a HMO and the landlord has extra obligations, and if they have failed to comply the Council may pursue for breach of HMO Regulations which may lead to a civil penalty of up to £30,000 or even criminal prosecution.
Furthermore, if a property is turned into a HMO the Council Tax has to be paid by the landlord, not the occupiers.
The other problem is that if the original tenant vacates the property leaving behind those he has sublet to then the landlord ends up having no idea who is occupying the property, creating all sorts of problems and potentially making it more difficult to recover possession.