Service charge accounts are how leaseholders know the money was spent on what they paid for. Most leases require them certified by an accountant. Every leaseholder has a statutory right to a summary of costs. The fix is commissioning a specialist, then circulating the output.
Service charge accounts are narrow in scope but have to follow specific conventions. A generalist accountant can do them but often misses the property-specific treatments (reserve fund, section 42 Landlord and Tenant Act 1987 trust, insurance claims). A property-specialist does the job in a fraction of the time and at lower risk.
Per year. Small blocks under 20 units: £500 to £1,500. Mid-size: £1,200 to £2,500. Complex or large: higher. London and SE add 20 to 30%.
From handing over records to receiving certified accounts. Busy periods (July-September for March year-ends) run longer. Plan ahead.
Once per financial year. Year-end is set by the lease (often March 31 or December 31). Circulate to leaseholders within the period the lease specifies, often 6 months after year-end.
What the accounts must show. All income (service charges demanded, interest on held funds, insurance proceeds). All expenditure grouped by category (repairs, insurance, management fees, reserve contributions, professional fees). Balance brought forward, balance carried forward. Reserve fund movement. Any surplus or deficit attributable to each leaseholder's share. Notes on accounting policies and any material adjustments. Accountants follow ICAEW TECH 03/11 guidance for the recommended form.
Most modern leases require certified accounts. Some require full audit. Some are silent. The level of assurance materially affects the accountant's fee. LEASE-iQ extracts the accounts clause from your lease and tells you what your lease requires, so you don't over-spec or under-spec.
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Common in small self-managed blocks with no agent. The directors collect service charges, pay bills from a joint account, and never formalise the accounts. A leaseholder only has to exercise their Section 21 right once to expose this.
What to do. Commission a property-specialist accountant using the calculator below. Gather the bank statements, invoices, and prior years' records (even if informal). Expect a catch-up exercise for the first year, where the accountant regularises the treatment. Budget a one-off extra fee for the historic catch-up.
Accounts are being produced but either (a) the lease requires certification and you have only a director-signed statement, or (b) they are routinely circulated months or years late.
A leaseholder has written formally requesting a summary of costs. Under Section 21, the summary must be provided within one month of the request or six months of the end of the period, whichever is later.
Cost scales mostly with the number of units and the complexity of income. Specialist property accountants are usually cheaper than generalists for this specific job.
All figures are indicative ranges based on published rates checked April–May 2026. Always compare three written quotes for your specific building. Last reviewed for accuracy on the page legal-check date shown above.
The rule: property specialist, ICAEW or ACCA member, familiar with TECH 03/11. Generalist accountants can do the job but are usually slower and more expensive for this specific work.
Specifies TECH 03/11 and the right level of assurance. If an accountant pushes back, you have your answer.
The calculator above updates the unit count, complexity, and assurance level automatically.
Accountant fees are a legitimate service charge expense in every normal lease. Small enough to sit comfortably under the Section 20 threshold.
Include the accountant fee in your annual budget line for professional fees. Recover via your usual service charge demands. Attach to year-end accounts. Section 21B summary must accompany every demand.
If first-year accounts require a one-off catch-up fee (typically when no formal accounts have been produced for several years), issue a one-off levy. Include the Section 21B summary. Most leaseholders accept when the reason is transparent.
Normal accountant fees do not trigger consultation. A long-term engagement contract (over 12 months) with an accountant may if the annual cost exceeds £100 per leaseholder. For most blocks that means year-by-year engagement, or a one-year renewable contract, keeps you clear. A multi-year fixed-fee contract over £100 per leaseholder per year triggers Schedule 2 consultation. See the Section 20 process.
Keep the engagement letter, the accounts, and the accountant's certification on file permanently. Circulate accounts to all leaseholders within the period the lease specifies.
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Read the Hafer Road case study →BLOCK-iQ holds invoices and bank feeds against the building record. When year-end hits, the accountant receives a clean data package and the turnaround drops by half. Section 21 requests are answered from the same dataset.