I thought it was fishy, too.
Our contract says that if the landlord agrees it would turn into a month-to month-contract at the end of the fixed term.
But there is also another clause in there that we shall pay £114 for any tenancy agreement for any extension of the tenancy.
So basically it's up to the landlord to decide what type of contract we'll get, and they may have decided to have us pay the upfront rent again. The letting agent is checking back with the landlord at the moment. Which means that they might have just decided themselves to do the extension contract.
Let's see what happens.
Do you think after 5/6 month in the UK paying our bills, council taxes, earning a salary, having a bank account and paying rent we would be eligible for a "normal" rent contract? I.e., would a tenancy check come back positive? If they want to make us sign another upfront contract we'd consider moving out. But of course, only if we can get another place without upfront payment.