What are Service Charges, and why are they necessary?
Any property with a shared ownership structure needs to be maintained. Service charges principally cover the cost of maintenance, repairs, insurance and management of the shared property.
How are they charged?
The lease document sets out how and what can be charged by the Landlord in Service Charges. Any service charge bill a Tenant receives should be in compliance with the lease.
What are my rights?
As a Tenant, you have the right to be consulted about any proposed charges and works if the proposed cost is more than £250 (or £100 per year if the work lasts longer than 12 months). There is a formal notice the Landlord must serve to consult you before work is agreed upon. Read more about your rights as a Tenant.
As a Landlord, you have the right to recover the service charge costs from the leaseholders. This is still the case even if you are a group of resident owners who collectively purchased the freehold. Read more about your rights as a Landlord, and Service Charge recovery.
What if there is a Service Charge dispute?
There is a procedure to take the matter to the First Tier Tribunal Property Chamber (FTT), however all parties should be mindful of the costs involved.
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Many a dispute arises between a landlord and tenant in the course of a tenancy, but probably none more so than those concerning service charge costs. Disputes in this area have kept the Property Tribunals especially busy and the recent Upper Tribunal (Lands Chamber) decision in the case of Cos Services Ltd -v- Nicholson &… Read more »
Is it a Lessee’s charter to avoid payment of service charges? The Pre-action Protocol for Debt Claims (“the Debt Protocol”) came into force on 1 October 2017. It applies to any debt claim where a business (including sole traders and public bodies) is seeking to recover payment of a debt from an individual debtor (including… Read more »
A Section 21 report under the provisions of Section 21 of the Landlord and Tenant Act 1985 is an interesting but possibly useless report of the interim service charge costs. However, it might be useful to tenants wishing to make an enquiry into a service charge budget. However, it does have a sting in the… Read more »