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What are the ‘service charge budgets’?

Common charges

1. How do you work out the annual service charge?

For newly built developments, the service charge is based on estimated costs. We make every attempt to make sure the budget is accurate and as close as possible to actual costs.
For established residential buildings, developments and estates, we use the previous year’s costs to prepare the estimate for the coming year.

We have no control over charges such as VAT, so we can only anticipate what this is likely to be. For utility costs such as electricity, we use our national buying power to negotiate competitive rates that are significantly lower than normal domestic tariffs. Our aim is to ensure all utility charges remain as low as possible.

2. When is the service charge worked out?

We prepare a budget based on the estimated service charges for the next financial year a few months before it starts.

If you live in an independent retirement living development you will be invited to a budget meeting held by the Area Manager, where they will consult with you before the budget is finalised.

3. What is the difference between a budget and accounts?

We prepare a budget based on the estimated service charges for the next financial year (which is set by the Deeds of Conditions and prescribes what period service charges must be accounted for).

We do this a few months before it starts – you will typically receive the finished budget about a month before the financial year begins. (If you live in an independent retirement living development you will be invited to a budget meeting, held by the Area Manager, where they will consult with you before the budget is finalised).

For newly built developments, the service charge is based on estimated costs. We make every attempt to make sure the budget is accurate and as close as possible to actual costs. For established developments, we use the previous year’s costs to prepare the estimate for the coming year.

For retirement developments, following the end of the development’s financial year the annual accounts are prepared and then audited by an independent accountant. Within the accounts that we send you will be a full summary of service charge expenditure for the financial year broken down by categories of expenditure. We highlight where residential property management expenditure hasn’t been in line with our estimate, giving an explanation for any significant differences.

A summary is sent to every owner. (If you live in an independent retirement living development you will be invited to a residents’ meeting held by the Area Manager where you can ask any questions. We keep a record of all invoices and you can ask to see this information at any time.)
There is often an adjustment to the service charge after the year-end as it is unlikely that our estimate will equal the amount expended during the year. This adjustment can be a credit (if we over estimate) or a debit (if we under estimate). If we under estimate; an invoice will be sent to you for the balance due. If we over estimate, the adjustment is credited to your account and will reduce future invoices.

Download our A Guide to Fees brochure for more details. (TO BE ADDED)

For residents in general residential developments, we send your estimated service charges for the next financial year, as prepared by the Area Manager. They will be happy to answer any questions on the budget they have set for the year. Please get in touch with your Development Manager, where applicable, or our Customer Services team.

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