The clarification comes after the housing agency, Threshold, raised concerns earlier this month, about the number of landlords citing substantial refurbishment as grounds to end a tenancy.
The housing agency said it had been contacted by more than 200 tenants about the issue this year.
Rosalind Carroll, director of the Residential Tenancies Board, said: “The key point for people to understand is that for the exemption to apply, there needs to be a substantial change in the nature of the accommodation being provided, so it is not just about improving a property but about significant changes; for example, has the property been extended.”
Sinn Féin housing spokesman Eoin Ó Broin has criticised the new guidelines, saying they “are not worth the paper they’re printed on”.
Mr Ó Broin said: “There is simply no justification for landlords who undertake substantial refurbishment from being exempt from the rent pressure zone cap. They can already write these costs off against their tax liability.”
He said he was “also concerned that the onus for policing these new guidelines will rest with the tenant.
“This is not acceptable or fair on tenants, especially more vulnerable tenants.”