How to Challenge Service Charges in Leasehold Flats (UK Guide)

Service charges are the ongoing costs leaseholders pay towards the upkeep and management of their building, and they are one of the most common sources of dispute in leasehold flats. 

The good news is that leaseholders have strong statutory rights to challenge charges that are unreasonable, incorrectly demanded, or not permitted by the lease. In this guide, we explain how service charges work, when they go wrong, and the practical steps you can take to challenge them effectively. For a broader overview, see our Service Charges explained blog. 

If you’re already worried about spiralling costs, getting specialist support with RTM or buying your freehold and more early can save time and stress. 

What service charges are, and when they go wrong

Service charges are payments made by leaseholders to cover shared costs such as repairs, maintenance, buildings insurance, cleaning, and managing agent fees.

For a charge to be recoverable, it must meet two key requirements:

• It must be allowed under the terms of the lease.
• It must be reasonable in both amount and standard of work, under the Landlord and Tenant Act 1985.

Disputes often arise where there is poor transparency, aggressive or unresponsive managing agents, or large “major works” bills with limited explanation.

For example, a block might suddenly receive a demand for £15,000 per flat for roof repairs, with no survey, no competitive tendering, and little detail on how the cost was calculated. That is exactly the type of situation where leaseholders should pause and challenge.

Your legal rights to question and challenge service charges

Key statutory protections

Leaseholders benefit from several important statutory protections. Key rights include:

• The right to challenge whether a service charge is payable at all, and whether it is reasonable, via the First-tier Tribunal (Property Chamber) under section 27A of the Landlord and Tenant Act 1985.
• The right to request a written summary of service charges under section 21.
• The right to inspect accounts, invoices, and supporting documents under section 22.

There are also strict rules landlords must follow:

• Costs generally must be demanded within 18 months of being incurred, unless you were notified earlier (section 20B).
• For major works or long-term agreements, landlords must follow the section 20 consultation process, or the amount they can recover may be capped.

When you can challenge

You may have grounds to challenge if:

• The demand was not issued correctly (missing required summary of rights, incorrect details, etc.).
• The charge is not permitted under the lease wording.
• Costs are excessive or the work is unnecessary.
• Work was carried out to a poor standard or due to landlord neglect.
• Section 20 consultation rules were not followed for major works.
• The demand was issued outside the 18-month time limit.

Where these issues are recurring, it is often a sign of deeper management problems. Many leaseholders in this position start exploring longer-term solutions like Right to Manage or buying the freehold to gain control over costs and decision-making.

Step‑by‑step: How to challenge your service charges

Step 1: Check your lease and the demand

Start with your lease. Does it actually allow the landlord to recover this type of cost, and how should it be split between flats? Then check whether the demand complies with legal requirements, including the summary of rights and obligations.

Keep a clear file of your lease, demands, accounts, and correspondence. This becomes essential if the dispute escalates.

If your building has multiple flats and you are already working together, The Freehold Collective can help assess whether long-term solutions like buying the freehold or using Right to Manage would reduce future disputes.

Step 2: Use your information rights

Request a written summary of costs for the last 12 months (section 21), and ask to inspect supporting documents (section 22).

Key documents include:

• Detailed cost breakdowns
• Managing agent contracts
• Quotes and tender documents
• Surveyor or engineer reports

This evidence will be critical if you later apply to the Tribunal.

Step 3: Raise an informal challenge

Write a clear, factual letter or email identifying the specific charges you dispute. Refer to the lease and any supporting evidence.

Many disputes are resolved at this stage, especially where leaseholders are organised and informed.

Avoid simply withholding payment without advice. In some cases, you can pay “under protest” while challenging, which may reduce the risk of enforcement action or forfeiture threats.

Where several flats are affected, a coordinated approach is often far more effective. Taking early advice can help ensure everyone presents a consistent and well-supported position.

Step 4: Escalate to the First‑tier Tribunal

If the issue is not resolved, you can apply to the First-tier Tribunal (Property Chamber).

The Tribunal can decide:

• Whether a charge is payable
• Whether it is reasonable
• Who should pay and how much

The process typically involves:

• Submitting an application with your lease and supporting documents
• Indicating whether a paper decision or hearing is appropriate
• Attending a relatively informal hearing where evidence is reviewed

Although Tribunal costs are usually limited, landlords can sometimes recover legal costs through the service charge or as administration charges. It is important to understand this risk before proceeding.

Common pitfalls and cost traps for leaseholders

If your lease agreement allows the landlord to recover costs such as management fees, these must still be limited to relevant costs that are reasonably incurred. Where leaseholders believe they are being asked to pay service charges that are excessive or unsupported, this can form the basis of tenant disputes and, if necessary, legal proceedings. 

Challenging unreasonable service charges early can help prevent escalation and ensure you are only paying what is lawfully due.

Leaseholders often run into avoidable issues, such as:

• Withholding payment without checking legal compliance or paying under protest
• Delaying action and missing key time limits
• Underestimating the landlord’s ability to pass on legal costs
• Tackling complex disputes alone when collective action would be more effective

For example, some blocks end up disputing gardening or insurance costs every year, when the real solution would be to change how the building is managed or owned.

When challenging charges isn’t enough, take control of your building

Repeated disputes about service charges often point to a deeper issue: misaligned incentives between leaseholders and the freeholder or managing agent.

In these cases, structural solutions can offer far better long-term outcomes:

• Right to Manage: Leaseholders take over management of the building, allowing them to appoint better agents and control budgets. If your building is facing repeated service charge disputes, The Freehold Collective can support you through the full RTM process.
• Collective enfranchisement (buying the freehold): Leaseholders become their own landlord, gaining full control over service charges, insurance, and long-term planning. The Freehold Collective can help you assess whether buying the freehold would be cost-effective in the long run.
• Lease extension and commonhold: Extending leases or transitioning to commonhold can modernise ownership structures and provide more democratic control.

Next steps if you think your service charges are unfair

• Gather your lease, recent service charge demands, and any consultation notices.
• Request detailed breakdowns and supporting documents.
• Speak to other leaseholders and consider a joint approach.
• Take early advice on Tribunal options and long-term solutions like RTM or buying the freehold.

Even if you are not ready to take formal action, an initial conversation can help you map out your options and avoid costly missteps.

You can book a free consultation to explore whether RTM, collective enfranchisement, or a lease extension is the best route to reduce future disputes.