Testing a service charge

Fairness is not one national benchmark.

A useful review starts with lease authority, the leaseholder's share, what was supplied, how the cost was incurred and the evidence behind it. A comparison figure can prompt a question, but it cannot decide the case.

The amount only becomes meaningful when it is connected to the lease, the work and the evidence.

Four separate tests

Do not collapse the review into a red or green score.

Authority

Does the lease permit this cost?

Find the service or work, payer, charging period, apportionment and payment machinery in the executed lease and any later deed.

Amount

Was the cost reasonably incurred?

For a variable residential service charge, section 19 is the statutory starting point. Price, necessity, scope, procurement, urgency and alternatives may all be relevant.

Standard

Was the service or work reasonable?

Inspect specifications, reports, completion evidence, complaints and outcomes. A correctly procured contract can still leave a question about what was delivered.

Process

Were the relevant information and consultation steps followed?

Demand paperwork, accounts requests, section 20 consultation and lease procedures are distinct routes with different tests and consequences.

Use comparisons carefully

A comparator should create a question, not a verdict.

Building

Compare like with like

Size, age, lifts, heating, staffing, insurance risk, safety duties, contracts and planned works can make two nearby buildings materially different.

Period

Use the same accounting basis

Separate routine expenditure, reserve contributions, major works, prior-year adjustments and one-off items before comparing totals or cost per flat.

Evidence

Ask what explains the difference

Use the comparator to request a breakdown, contract, invoice, specification or procurement explanation. Do not treat an internet average as evidence that a charge is payable or unreasonable.

Create the review record

Turn concern into a question that can be answered.

Name the line item and period

Record the amount, demand, budget or account and the lease clause said to support it.

Request the missing material

Use the lease and the statutory information routes where appropriate. Be precise about the invoice, contract, explanation or inspection required.

State the unresolved test

Say whether the issue is authority, allocation, reasonableness, standard, consultation, timing or missing evidence.

Choose the next forum

The answer may lie in clarification, complaint, mediation, professional review or a tribunal application. Keep payment and enforcement advice case-specific.

Sources for this page

Open the law and guidance yourself.

Primary lawLandlord and Tenant Act 1985, section 19

Reasonably incurred costs and reasonable standards for variable residential service charges.

Independent guidanceLEASE guide to service charges

Current guidance on lease authority, reasonableness, information and challenge routes.

Practical routeBuilding Trust service-charge review

A source-led route through the lease, demand and cost evidence.

Links and current-law position checked 18 August 2026. Apply the governing documents, building facts and current law to the case in front of you.

Take the next step in LEASE-iQ

Can this cost be recovered through my lease?

Use this for a charge, budget increase, reserve-fund contribution or disputed service.

Ready to copy

Questions to paste into LEASE-iQ

I have uploaded the signed lease for the relevant flat. Please analyse whether the following cost can be recovered from this leaseholder: [describe the cost, service, work, period and amount].

Please:
1. Identify the landlord, tenant and any management company or other relevant party in this lease.
2. Find every clause and schedule that may authorise, limit or exclude this cost. Quote the short relevant wording and give the clause and page.
3. Explain the cost category, payment date, apportionment method and any budget, account, certification or reserve-fund requirements in the lease.
4. Separate what the lease says from what current law may add, qualify or override.
5. State what the lease cannot prove, including whether the cost was incurred, the work was done, the amount was reasonable or the demand paperwork was correct.
6. Give the strongest reasonable reading against recovery as well as the reading in favour.
7. Finish with one of: supported, partly supported, ambiguous or not found. List the documents and facts I should check next before anyone decides whether the charge is payable.

Keep checking: The lease can show the charging route. It cannot prove the amount, standard of work or demand paperwork on its own.