Challenge to Unreasonable Service Charges

Legal Basis

Landlord and Tenant Act 1985, s.19 (service charges — limitation to reasonable costs); s.21 (right to demand a summary of costs); s.22 (right to inspect accounts, receipts, and other documents). Service charges are only payable to the extent that the costs are reasonably incurred and, where works are involved, the works are of a reasonable standard. The First-tier Tribunal (Property Chamber) has jurisdiction to determine the reasonableness of service charges.

• ✗Not first requesting a summary of costs and supporting invoices under s.21 LTA 1985 before challenging
• ✗Withholding all service charges rather than ringfencing disputed amounts in a separate account
• ✗Missing the 18-month rule — landlords cannot demand service charges for costs incurred more than 18 months earlier unless a notice was given within 18 months (s.20B LTA 1985)
• ✗Not checking whether Section 20 consultation was carried out for qualifying works over £250 per leaseholder

Build Your Letter

[YOUR FULL NAME (LEASEHOLDER)]
[YOUR PROPERTY ADDRESS]

[DATE OF LETTER]

[LANDLORD OR MANAGEMENT COMPANY NAME]

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Dear Sir or Madam,

**FORMAL CHALLENGE TO SERVICE CHARGES — [SERVICE CHARGE PERIOD BEING CHALLENGED]**
**Property: [YOUR PROPERTY ADDRESS]**

I write as the leaseholder of the above property to formally challenge the service charges demanded for the period [SERVICE CHARGE PERIOD BEING CHALLENGED] in the sum of £[TOTAL AMOUNT BEING DISPUTED (£)].

**Grounds of challenge**

[DETAILED GROUNDS FOR YOUR CHALLENGE]

**Legal basis**

Pursuant to section 19 of the Landlord and Tenant Act 1985, service charges are only recoverable to the extent that the costs incurred are reasonable. The relevant costs must have been reasonably incurred and, where services or works are provided, the services or works must be of a reasonable standard. I do not accept that the charges demanded satisfy this test.

**Request for information**

In accordance with section 21 of the Landlord and Tenant Act 1985, I formally request a written summary of the costs incurred during the period [SERVICE CHARGE PERIOD BEING CHALLENGED] within 21 days. I further request, pursuant to section 22 of the 1985 Act, an opportunity to inspect the accounts, receipts, and supporting documentation within the same period. Please confirm a date and time for inspection.

**Position on payment**

Without prejudice to my challenge to the reasonableness of the charges, I am willing to pay the undisputed portion of the service charge demand while this dispute is resolved. I reserve my right to apply to the First-tier Tribunal (Property Chamber) under section 27A of the Landlord and Tenant Act 1985 for a determination of the reasonableness of the disputed charges.

Please respond within 21 days of the date of this letter.

Yours faithfully,

[YOUR FULL NAME (LEASEHOLDER)]

Frequently asked questions

What makes service charges unreasonable under the law?

Under section 19 of the Landlord and Tenant Act 1985, service charges are only recoverable to the extent that costs are reasonably incurred. If services or works are provided, they must also be of a reasonable standard. If you believe these tests are not met, you can formally challenge the charges. The First-tier Tribunal (Property Chamber) has jurisdiction to determine the reasonableness of these service charges.

What steps should I take before formally challenging service charges?

You should first request a written summary of costs and supporting invoices under section 21 of the Landlord and Tenant Act 1985. You may also request to inspect accounts and receipts under section 22. Sending a formal challenge letter creates a paper trail before potentially applying to the First-tier Tribunal (Property Chamber). Always check your lease before disputing charges.

Can I stop paying service charges while I dispute them?

Withholding all service charges without a formal dispute can expose you to forfeiture proceedings. Instead, you should ringfence the disputed amounts in a separate account while paying the undisputed portion. This approach protects your position while you challenge the reasonableness of the specific costs you believe are excessive or unsupported.

What is Section 20 consultation and why does it matter?

For qualifying works that cost more than £250 per leaseholder, landlords must carry out Section 20 consultation. If this consultation was not properly carried out, it can form part of your grounds for challenging the service charges. You should check whether this process was followed for any major works included in your bill.