Service charges are the payments that you make towards our costs of providing and maintaining services for the block of flats where you live. We are responsible for maintaining the structure and exterior of the whole building and the communal areas such as halls and stairways. The costs incurred by us are passed back to you through the service charges.
When you purchase a flat, you'll need to pay service charges. No element of profit is included, so the charges relate to actual or estimated costs only. The service charges are split fairly between all the flats in the block. The cost of services to tenants is not subsidised in any way by leaseholders.
How the service charges are calculated and billed
At the start of each service charge year - which runs from 1 April to 31 March - we prepare an estimate of the costs we expect to pay for services. This is calculated by using the latest available actual costs for a year and the average of the previous five years' repair costs. The estimated charges will be billed to you during March each year, for the coming year.
How to pay the service charges
The simplest way to make sure that you pay the correct amount on time is to set up a Direct Debit. Please email us at firstname.lastname@example.org or phone us on 01494 476100 to make arrangements to pay.
Alternative ways to pay can be found on the reverse of your invoice. Please make sure that you quote your invoice reference number on any payment so that the payment reaches your account.
What happens if you don't pay your service charges?
If you do not pay your invoice by the date it is due and you have not arranged to pay by instalments, a reminder will be sent to you. If no payment is made within a further seven days, a final notice will be sent to you. If we still do not receive a payment and no arrangement has been made to make payments by instalments, we will take legal action in the County Court to get the money back.
Once we have obtained a County Court Judgment we will approach your mortgage company and ask them to settle the debt against your mortgage. This could lead to your home being repossessed and make it difficult for you to obtain credit cards, mortgages and loans in the future. If we fail to recover the debt from the mortgage company, we may seek a court order that allows deductions to be made from your salary or ask bailiffs to seize and sell your possessions. In the most serious circumstances we may seek forfeiture which would mean that you lose your home but this is something we want to try hard to avoid.
If you have any problems paying your service charges bill, please get in touch with us straight away. If you contact us quickly, we will try to help and avoid taking any legal action.
Limits on service charges during the first five years
If you buy a lease from us under the Right to Buy or Right to Acquire schemes you will be given a notice known as a "Notice of Purchase Price", as required by Section 125 of the Housing Act 1985. This notice includes estimates for services and works that are carried out on a regular basis, together with a schedule of major repairs or improvements which are planned. We cannot charge you more than the estimates plus an allowance for inflation for such work during an initial period of five years from the date when the lease was first sold. When that period has run out, we can charge you your share of the reasonable cost of any work which is done.
Service charges - your rights
Your right to ask us for a summary of costs
This must relate to service charges for the current or the previous year. Our summary will show how the costs we have paid are reflected in your service charges. If there are four or more flats involved in the costs, the summary will be signed by a qualified accountant. Once you have the summary, you have six months to write to us and arrange to look at and copy any accounts, receipts and other relevant documents. We will provide these facilities free of charge, but we may add the cost to the management costs in the yearly service charge. When we receive your request to look at the accounts, we have a month to reply to you and should make the facilities available for up to two months.
Your right to have a management audit
This would look at the services we provide and at their costs. You will appoint and pay for a qualified auditor to examine how effectively we are carrying out the housing management duties we charge you for; and how we are using your service charges.
To start the process, your auditor must send us a ‘Section 80 notice’. All the leaseholders involved must sign the notice and include their full names and addresses. It should also show the name and address of the auditor and list the documents that the auditor will need.
The auditor can look at documents and the shared parts of the buildings we manage. If the auditor wants to look at any shared parts, the notice should give a date on which the inspection will take place. We have a month to reply from the date of the notice. Our reply must include the relevant documents the auditor has asked for and what facilities will be available to look at them and copy them. It should confirm the inspection date or offer a different date. Again, we may add the cost of providing these facilities to the management costs in the yearly service charge.
More information can be found in the leasehold handbook.
Sheltered housing and some blocks of flats have cleaning provided for all internal and external communal areas (other than where the service is already covered by the grounds maintenance or waste and cleansing services or the Estate Warden service).
Most sheltered flats, some sheltered schemes and most general needs flats have communal windows and glazed doors, which are cleaned by our contractors.
Communal Laundry Service
Sheltered schemes provide a communal laundry service to tenants and this cost covers the repair and maintenance of this service. Some aged persons dwellings bungalows located on the same scheme may also have access.
Estate and Grounds Maintenance
This service is mainly provided to sheltered schemes and blocks of flats, but costs may also apply to individual bungalows and houses who benefit from the services. They provide grass cutting, maintenance of flower beds, litter picking, shrub maintenance, maintenance of paths, handrails, car parks, access roads and snow clearance.
This charge includes services such as: the cost of replacement light bulbs energy costs for lighting (including emergency lighting), energy and servicing costs for communal area heating, communal water supply legionella testing for communal water tanks and supplying grit for winter use
Door Entry Systems
This generally applies to blocks of general needs flats and includes the costs of servicing, maintenance and replacement. While sheltered schemes have door entry, it is linked to the Community Alarm system and therefore paid for through the Community Call Service.
There are a number of lifts in sheltered schemes which require regular servicing, maintenance and occasionally replacing to make sure they are safe to use.
Waste & Cleansing
This cost covers fly-tipping, litter and graffiti removal, removal of dumped waste from internal common areas, providing cleaning services at car parks, and the cleaning and replacement of communal bins where such services are provided.
This charge covers the cost of the maintenance of communal aerials to some sheltered schemes and blocks of flats.
This charge covers the cost of a service where there are infestations in communal areas of sheltered schemes, blocks of flats, play areas and car parks.
Estate Warden Service
This was previously known as the Caretaking Service. It applies to some general needs blocks of flats and includes a range of duties within internal and external communal areas including cleaning, and may also include changing light bulbs and alarm testing.
Scheme Management Service
This is the cost of providing the sheltered housing service to sheltered schemes, excluding “Support Costs”. "Support Costs" are charged through the tenancy agreement in addition to your rent and are usually met by a Supporting People grant for those who receive housing benefit. Those who don't receive a Supporting People grant meet the cost themselves. The service may be provided by roles that may be residential or mobile.
This covers the cost of fuel used, servicing and repairs where there is a communal boiler which provides heating and, in some cases, the hot water to tenants flats.
This charge covers the cost of the provision and maintenance of communal aerials to sheltered schemes and blocks of flats. Some properties are charged for this service as a separate service charge, others currently pay for the service in their rent.
We arrange buildings insurance for all our leasehold properties, the cost of which is covered through the leaseholder service charge.