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What is a service charge?
A service charge is a payment for services received in connection to shared areas within your building and estate of your home.
Your tenancy agreement or lease should list the services covered by your service charge, which is set annually. Homeowners can read more about how a service charge is collected and what it is used for.
Charges are reviewed each year to enable us to recover the estimated costs for services, which may go up and down. If you pay a service charge, we will write to you with a detailed breakdown of the services and charges, that make up the service charge.
You will receive an annual notification of your reviewed service charge. These are issued each year. This is mainly issued in early March if your tenancy/lease agreement has an April review date or early June for July review dates.
Example of services which may be included
- Cleaning of shared areas, such as entrance halls, communal corridors, stairs, and lifts
- Door Entry, CCTV and Lift Maintenance
- Maintenance and servicing of Fire Alarms and other emergency equipment in shared areas
- Maintenance and servicing of shared TV aerials/satellite systems for an estate/block
- Heating and Hot water for shared areas
- Lighting in shared areas
- Gardening and grounds maintenance
- Community caretakers, scheme/night managers/concierge services
Housing Benefit / Universal Credit do not cover some charges, such as heating and hot water, therefore you may have to pay for these services yourself. These charges are reviewed every year and may go up or down.
How is your service charge calculated?
A service charge budget is calculated each year. We review the services provided and costs each year. We use the latest available information such as inflation, changes in prices or rates from contractors/suppliers to estimate how costs we are expecting to incur will change in the coming year. These estimated costs are split between all the applicable properties over a 52-week period to calculate the weekly charge and 12-month period to calculate the monthly charge.
Homeowner service charge
If you own your own home or are living in a leasehold property and you receive services from us (see list above), you are required to pay an annual service charge. Please see above on how the service charge is calculated.
The service charge is billed in advance for services and costs associated with managing and maintaining your building and estate. The service charge you pay as a homeowner is based on estimates, actual costs are not known until after the end of the financial year (March) where the charges have been incurred.
Each year when the financial year ends in March, an annual statement of the actual costs for services incurred compared to estimated costs charged is created and are sent to homeowners. The annual statement of actual costs of services is to be issued six months after the close of the financial year along with notification of how the surplus and deficit is treated in accordance with your lease.