Does the Service Charge on Flats Cover Repair Costs?

If you're a leaseholder, you've probably looked at your service charge bill and wondered exactly what repairs it covers. The answer isn't always straightforward, and misunderstanding what's included can lead to unexpected bills or disputes with your landlord.

The Short Answer

Service charges typically cover repairs to the building's structure and common areas, but not repairs inside your individual flat. However, the specifics depend entirely on what your lease says. Your lease is the legal document that defines what the service charge should cover.

What Repairs Service Charges Usually Cover

Building Structure and External Repairs

Service charges normally cover repairs to the building's fabric – the roof, external walls, foundations, and load-bearing structures. If the roof develops a leak, the chimney needs repointing, or external rendering cracks, these repairs come from the service charge pot.

This makes sense because these elements serve the entire building. A leaking roof affects multiple flats, and individual leaseholders can't reasonably fix structural issues themselves.

Common Area Repairs

Repairs to shared spaces fall under service charges. This includes entrance halls, corridors, stairwells, landings, and communal bathrooms or utility rooms. If the hallway ceiling needs plastering, communal carpet replacing, or shared lighting fixtures repairing, the service charge covers it.

Shared Facilities and Equipment

Lifts require regular maintenance and occasional repairs – these come from service charges. The same applies to entry systems, communal heating boilers, fire alarm systems, CCTV equipment, and door entry mechanisms. Basically, any equipment serving multiple flats falls under communal repairs.

External Areas

Gardens, courtyards, pathways, driveways, and car parks are communal assets. Repairs to gates, fences, drainage systems, or paving typically come from service charges. If a wall surrounding the property needs rebuilding or communal bins need replacing, this is usually covered.

Pipes, Wiring, and Services

This is where it gets complicated. Many leases specify that service charges cover repairs to pipes, wires, and cables that serve more than one property, even if they run through your flat.

A water pipe running through your ceiling that serves flats above yours might be covered by service charges, even though it's physically in your property. Similarly, communal electrical circuits or waste pipes serving multiple flats often fall under service charge repairs.

What Service Charges Don't Cover

Inside Your Flat

Repairs within your flat are almost always your responsibility. Your boiler, kitchen appliances, bathroom fixtures, internal doors, flooring, decoration, and fitted furniture are yours to maintain and repair.

If your ceiling cracks, your radiator leaks, or your kitchen tap breaks, you pay for these repairs yourself. The service charge doesn't cover them, even if they're expensive.

Windows and Doors

This varies significantly. Some leases make the landlord responsible for external window and door frames (covered by service charges), while you're responsible for internal decoration and mechanisms. Other leases make leaseholders entirely responsible for their own windows and doors.

Check your lease carefully. In buildings with uniform windows installed as part of the building's structure, service charges often cover replacement. In conversions where each flat has different windows, you might be solely responsible.

Improvements vs Repairs

Service charges should cover repairs – fixing things back to their previous condition. They shouldn't cover improvements or upgrades unless your lease specifically permits this.

Replacing a broken roof tile is a repair. Replacing the entire roof with superior materials when the current one still functions might be an improvement. Leaseholders can challenge improvement costs that aren't permitted by their lease.

The distinction isn't always clear-cut, and disputes frequently arise over whether work constitutes repair or improvement.

Emergency Repairs

Most management companies can carry out urgent repairs immediately and charge them to the service charge, even if they haven't consulted leaseholders. Emergency repairs might include:

• Water leaks causing immediate damage
• Structural dangers requiring urgent attention
• Failed heating in winter
• Lift breakdowns (especially in buildings with elderly or disabled residents)

While these bypass normal consultation requirements, they must still be reasonable in cost and genuinely urgent.

Major Works and Section 20

When substantial repairs are needed – new roofs, facade refurbishment, lift replacement – these are "major works." If your share exceeds £250, landlords must follow Section 20 consultation procedures.

You'll receive notices explaining the work, see estimates from contractors, and have opportunities to comment. The landlord must consider your observations and normally accept the lowest reasonable quote.

Section 20 exists because major repairs can cost tens of thousands of pounds. Without proper consultation, landlords might overspend or commission unnecessary work.

Reserve Funds and Planned Repairs

Well-run buildings collect reserve fund contributions through the annual service charge. This money accumulates to cover foreseeable major repairs – roof replacement, external decoration, lift overhauls.

If your service charge includes reserve fund contributions, you're essentially pre-paying for future repairs. When major works happen, the reserve fund covers most or all costs, avoiding large one-off bills.

Buildings without reserve funds hit leaseholders with huge Section 20 bills when major repairs arise. You might pay £1,500 annually in service charges, then suddenly receive a £15,000 demand for facade repairs.

Who Decides What Repairs Happen?

Your landlord or management company identifies necessary repairs and commissions work. You don't usually get to vote on individual repairs, though you can raise concerns or request particular repairs through your managing agent.

For major works requiring Section 20 consultation, you have input. You can question whether the work is necessary, comment on specifications, and suggest alternative contractors.

Some buildings have residents' associations or right to manage companies, giving leaseholders more control over repair decisions and spending priorities.

Checking Your Lease

Your lease defines what the service charge covers. Read the sections on "Services" or "Expenditure" carefully. Leases vary enormously – some are comprehensive, others vague.

Look for phrases like:

• "Repairing, renewing, and maintaining the structure"
• "Keeping in good repair the common parts"
• "Maintaining conduits, pipes, wires, and cables serving more than one property"

If your lease is ambiguous about what repairs are covered, this can lead to disputes. In such cases, either party can apply to the First-tier Tribunal for determination.

What If Repairs Aren't Done?

If you're paying service charges but necessary repairs aren't happening, you have options:

You can report disrepair to your landlord formally in writing. If they don't respond adequately, contact your local council's Environmental Health department for issues affecting health and safety.

You might withhold service charges, but this is risky. Landlords can take legal action for unpaid charges, potentially leading to lease forfeiture. Instead, pay under protest and challenge the charges through the tribunal.

For serious disrepair, you can apply for a manager to be appointed to replace the failing management company, or in extreme cases, seek collective enfranchisement to buy the freehold.

Challenging Unreasonable Repair Costs

Service charge repairs must be reasonable in cost and standard. If your landlord spends £50,000 replacing a roof when quotes for £30,000 were available, or uses gold-plated fixtures in a communal hallway, you can challenge this.

The First-tier Tribunal (Property Chamber) can determine whether costs are reasonable and payable. They'll consider whether the work was necessary, whether the standard was appropriate, and whether costs were excessive.

You can also challenge whether particular repairs should be covered by service charges at all, based on your lease provisions.

Understanding Your Service Charge Breakdown

Demand detailed accounts showing how service charge money is spent. You're legally entitled to see a summary of costs, and in buildings with five or more flats, you can inspect receipts and invoices.

Look for:

• Specific repair items and their costs
• Whether repairs were emergency or planned
• Contractor names and amounts paid
• Reserve fund allocations

If entries are vague ("repairs £5,000"), request itemization. You're entitled to understand what you're paying for.

Planned vs Reactive Repairs

Service charges should cover both:

Reactive repairs: Problems arising unexpectedly – burst pipes, broken lifts, failed heating systems. These can't be budgeted precisely, so service charge estimates include a contingency for unforeseen repairs.

Planned repairs: Scheduled maintenance and foreseeable repairs – external decoration every few years, regular lift servicing, gutter cleaning. Well-managed buildings anticipate these and budget accordingly.

Buildings doing too many expensive reactive repairs may have poor maintenance strategies. Preventative maintenance costs less long-term than constantly fixing crises.

The Bottom Line

Service charges generally cover repairs to the building's structure, common areas, and shared equipment, but not repairs inside your individual flat. The exact scope depends on your lease wording.

Understanding what's covered helps you budget appropriately. If service charges cover major structural repairs and you're building reserve funds, you're protected from large unexpected bills. If coverage is limited, you might face substantial costs outside your regular service charge.

Always read your lease, review service charge accounts annually, and don't hesitate to question costs that seem unreasonable or outside the lease's scope. As a leaseholder, you have legal rights to transparency and reasonable charges for genuine repairs.