Leasehold Service Charge - excessive deficit charges, what are my rights?

  • Filter
  • Time
  • Show
Clear All
new posts

    Leasehold Service Charge - excessive deficit charges, what are my rights?


    I was wondering if someone could kindly give guidance to leaseholder rights on service charges.

    Basically, my managing agent has billed me for a further £1899 (on top of a service charge that is already 3000 a year with no logical explanation given for it being so expensive!) for a deficit dating back to 2012/13 year of accounts where the financial statements have "now been completed" (just short of the 18month cut off for what is deemed "given in reasonable time"!).

    The managing agent is always responsible for budgeting and application of the service charge, and payments are made every 6 months to cover the service costs. I do not therefore understand how they can justify claiming that they under charged us by 63%!

    I have searched the internet but struggle to find information on what rights a leaseholder really has to challenge the charges, beyond the following:

    You have the right to apply to the First-tier Tribunal to ask it to determine whether your lease should be varied on the grounds that it does not make satisfactory provision in respect of the calculation of a service charge payable under the lease.
    You have the right to write to your landlord to request a written summary of the costs which make up the service charges. The summary must-
    cover the last 12 month period used for making up the accounts relating to the service charge ending no later than the date of your request, where the accounts are made up for 12 month periods; or
    cover the 12 month period ending with the date of your request, where the accounts are not made up for 12 month periods.
    The summary must be given to you within 1 month of your request or 6 months of the end of the period to which the summary relates whichever is the later.
    You have the right, within 6 months of receiving a written summary of costs, to require the landlord to provide you with reasonable facilities to inspect the accounts, receipts and other documents supporting the summary and for taking copies or extracts from them.

    However i cannot find which governing bodies look into this matter or how to apply to the first tier tribunal (or what the costs are)?

    Is anyone able to advise if i have any legal grounds to challenge this?

    You need to see the accounts in question with the income and expenditure sheet.


      Explanation of FTT process here:
      To save them chiming in, JPKeates, Theartfullodger, Boletus, Mindthegap, Macromia, Holy Cow & Ted.E.Bear think the opposite of me on almost every subject.


        There is no point trawling the internet just because you are cross.

        63 % is based on something, you take the budget for that year and the subtotals for individual expenses and see how they vary to actual expenditure totals in the accounts.

        You can then see that repairs were 20 % over or insurance 30 % over you can ask why.

        Only when you have that information can you act not liking paying an extra 63% is not enough, no matter how eye watering that is , sorry.
        Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.


          AS LHA has explained, service charges are not (or at least should not !) be plucked out of thin air, they are based on actual expenditure that the freeholder has spent on the property for your benefit.

          As mentioned, you have rights to ask for a breakdown of this, under S21 and 21 of Landlord & Tenant Act 1985, and if an application was made to the FTT, then the Fh would be forced to prove actual expenditure and even then whether costs were reasonable.

          The grounds to challange amounts are under S19 and 27 of same LTA 1985, but first have a look at the summary (assuming the FH provides one).

          It is quite feasible tyat there are increased costs but this depends on provisions of the lease and relevant law (although you point out he appears to have complied with the 18 month rule)
          Advice given is based on my experience representing myself as a leaseholder both in the County Court and at Leasehold Valuation Tribunals.

          I do not accept any liability to you in relation to the advice given.

          It is always recommended you seek further advice from a solicitor or legal expert.

          Always read your lease first, it is the legally binding contract between leaseholder and freeholder.


            You can get free advice and download free guides to many leasehold subjects including making application to FTT from LEASE ( Leasehold Advisory Service ) :



            Latest Activity


            • Reply to Freehold confusion
              by sgclacy
              Your friend may not have to have his ID confirmed as the consideration will be far less than £5,000 and if he did form ID5 makes life a lot easier as it can be done via a video link...
              24-05-2022, 19:59 PM
            • Freehold confusion
              by davetg
              30 years ago I bought a flat from a friend. The freehold at the time was registered to my friend and the lady who owned the other flat. I understood at the time that I would replace the friend on the freehold but this never happened. This was not a problem until now as when work on the structure of...
              24-05-2022, 14:29 PM
            • Reply to Section 20
              by Anna1985
              3, it feasible but we have already enforce the lease via small claims process, due to failure to pay for upkeep.
              so, we would be going again but just really need to understand what is allowable and what is not...
              24-05-2022, 18:56 PM
            • Section 20
              by Anna1985
              So the lease allows for the property to be kept in good condition.
              Thus, the shared hall could be spruced up no problem, but there is an issue with driveway - partially it belongs to the freeholder, partially to the ground floor leaseholder - it is made out of the old paving stones, it looks...
              22-05-2022, 21:03 PM
            • Reply to Old managing agents accounts
              by jazzythumper
              So the only statement we have shows, the significant arrears of the aforementioned leaseholder, the only accounts we have ever received at handover were the balances and arrears of each leaseholder. This was never accounted for against actual costs. I presume we should have had this information. Can...
              24-05-2022, 16:27 PM
            • Old managing agents accounts
              by jazzythumper
              Since obtaining the RTM and changing the managing agent, we have never been given full accounts / receipts for the previous year(s). We believe that as the old freeholder and leaser holder of one of the flats were represented by the same solicitor that prior to the sale of the freehold, we were subsidising...
              20-05-2022, 11:21 AM
            • Reply to Freehold confusion
              by davetg
              Thanks for the reply - both flats have separate 999 year leases so i guess the freehold is of little value. I will look in to TR1.

              I have always insured my flat separately and assumed the other flat was doing the same - is this a problem?...
              24-05-2022, 14:48 PM
            • Reply to Old managing agents accounts
              by jazzythumper
              Thanks, I’m not sure that has been provided, if it hasn’t can we force them to produce this?

              Would it be a simple case of sending a letter with a timescale to respond and if not received followed by the magistrates route?...
              24-05-2022, 14:39 PM
            • Reply to Freehold confusion
              by Section20z
              1.He will need to sign a TR1 and transfer title to you but it really needs to be done through a solicitor or land registry won't be happy with his ID.
              2. If you have a separate lease on your flat then freehold is not worth much, if not then it's worth what the flats worth at least .
              3. Cost...
              24-05-2022, 14:37 PM
            • Reply to Share of feehold/shared service charges?
              by Stu1020
              Thank you for the response Macromia this is a useful conversation.

              I can see why the current proportion might be justified, I have been paying 38% towards the buildings insurance the last 4/5 years. However, my dispute is now arising because we are unable to move forward with existing covenants,...
              24-05-2022, 08:55 AM