Service charges

What is a service charge and how do we work out how much they should be? Here we explain what they cover and what you can do if you need a bit more help with understanding them.

What is a service charge?

A service charge is your contribution towards the cost of additional services which are not covered by rent. You will only be charged a service charge if your home receives the service.

Typical charges may include:

  • communal cleaning

  • caretaking

  • communal lighting

  • servicing of communal door entry systems

  • servicing of communal firefighting equipment

  • servicing of communal lifts

  • grounds maintenance of communal areas. 

(Other services may apply. See below.)

How we set our service charges?

We look at what internal and external services are provided to each scheme and associated costs.

A 'scheme' might be an apartment block or group of homes that have a shared area. 

How we calculate service charges?

Once we have established the service cost to each scheme we share out the cost accordingly.

Here are some examples of how we apportion those costs. 

Example 1: Grounds maintenance

If there are 40 bungalows in a scheme the grounds maintenance annual cost would be divided by 40.

Example 2: Door entry system

If there are eight flats in a block the door entry servicing annual costs would be divided by eight. 

How often will I receive a service charge bill?

Every February you will receive your new rent and service charge letter (as required by the Housing Act 1988 for assured tenants). This letter will include notification of your new rent and breakdown of services and your properties share of the service charge costs.

Why do I pay different service charges to my neighbour?

Even though you may receive the same services as your neighbour, the terms of your tenancy agreement can sometimes mean you pay a different amount depending on when the tenancy started.

Your tenancy agreement confirms if your service charge is fixed or variable (see below).

It is also likely that your estate is made up of various tenure types, each tenure type gets charged in a different way.

Fixed and variable service charges

  • Fixed service charge: This charge is fixed at that start of the year, based on an estimate of the service cost. If the actual costs of the service at the end of the year are higher or lower than the estimate, the charge cannot be changed.
  • Variable service charge: This charge can vary and is set at the start of the year based on an estimate of the service cost. Unlike fixed service charges, if the actual costs are higher or lower than the estimate, the surplus or deficit will be carried forward into the following year’s calculation.

As per the terms of the tenancy agreement surplus’ cannot be refunded and deficits do not require payment.

What is the administration charge for?

This is what it costs us to manage and administer service charges, including tendering for services, managing service contracts, paying invoices, dealing with customer queries and preparing the statements.

How do I query my service charge?

Please use the form below to send us your question. We will get back to you within 10 workings days.

Ask a service charge question

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