How to Challenge Unreasonable Service Charges

You opened the envelope — or the email — and your stomach dropped. A service charge demand for thousands of pounds more than last year, with little or no explanation. Perhaps it was a sudden “major works” bill you were never consulted about, a management fee that has quietly doubled, or a line item for services you cannot identify. You are not powerless. Leaseholders in England and Wales have a suite of statutory rights, strengthened as recently as 2024, that let you demand transparency, challenge every penny, and hold managing agents and freeholders to account. This guide walks you through the entire process.

What makes a service charge “unreasonable”?

Section 19 of the Landlord and Tenant Act 1985 is your foundation. It says a service charge is only recoverable to the extent that costs were reasonably incurred and, where costs relate to works, those works are carried out to a reasonable standard. This gives you two separate lines of attack: was the expenditure itself sensible, and was the work any good?

A charge can be unreasonable for a wide range of reasons. The table below sets out the most common categories the First-tier Tribunal encounters:

Category	What it means	Typical example
Excessive cost and overcharging	The amount charged vastly exceeds the prevailing market rate for comparable services without any justifiable, building-specific cause.	Invoicing £500 to change a communal lightbulb; £20,000 for basic seasonal landscaping that normally costs £4,000.
Lack of competitive tendering	The agent awards lucrative contracts to a connected subsidiary or fails entirely to seek multiple independent quotes.	Using an in-house maintenance firm that charges a 40% premium over independent contractors for identical work.
Poor standard of work	The works were carried out, but the quality is objectively substandard, requiring further remedial expenditure to correct the initial failure.	A newly installed communal roof leaks immediately; communal painting left unfinished with hazardous materials on site.
Unnecessary works	The works were not genuinely required to maintain the building, or were initiated prematurely without supporting surveyor evidence.	Replacing a fully functional, recently serviced lift system simply to exhaust a sinking fund or generate project management fees.

Look too for management fees that have ballooned with no corresponding increase in service, insurance premiums placed through opaque brokers where the agent may be receiving an undisclosed commission, and “administration fees” that duplicate work already covered by the standard management charge. Charges for services not covered by the lease are also challengeable — if your lease says nothing about providing a concierge, gym, or premium landscaping, the freeholder cannot invent those services and bill you for them.

Step 1: Read your lease

Before you write a single letter of complaint, pull out your lease and read the service charge provisions carefully. The lease is the contract that defines the boundary of what your freeholder can and cannot charge you for. If a particular service or type of expenditure is not explicitly permitted by the lease, the freeholder has no contractual basis to recover the cost — and it does not matter how “reasonable” the amount might be.

Pay close attention to schedules or clauses that list the services the landlord covenants to provide, and the corresponding obligation on leaseholders to contribute. Check whether the lease specifies a fixed percentage contribution or a “fair and reasonable proportion.” Note any caps, reserve fund provisions, or restrictions on the type of expenditure that can be charged. Many leases draw a clear line between structural repairs (usually recoverable), improvements or enhancements (often not recoverable), and costs that are the individual responsibility of a particular leaseholder. Make notes on each disputed item and ask two questions: is this type of cost allowed by the lease, and has it been incurred in a way that is reasonable in amount and standard? Those are exactly the questions the Tribunal will later consider under Section 27A.

Step 2: Demand the receipts

Your right to a summary of costs (Section 21)

Under Section 21 of the Landlord and Tenant Act 1985, you have the right to request a written summary of the costs that make up your service charge for the accounting period in question. Write to the landlord or managing agent citing Section 21 — the request is valid even if served on the agent rather than the freeholder directly. The landlord must provide the summary within one month of your written request, or within six months of the end of the accounting period, whichever is later. The summary must be certified by a qualified accountant if the building contains more than four dwellings.

Your right to inspect the invoices (Section 22)

Once you have the summary, Section 22 gives you the right to inspect the invoices, receipts, and other documents that support the figures. You must make this request in writing within six months of receiving the summary. The landlord must then make the documents available for inspection — free of charge — within 21 days of your request, and must keep them available for at least two months. They may charge a reasonable fee if you want copies.

Here is the part many managing agents hope you do not know: it is a criminal offence for the landlord or agent to fail to comply with a Section 22 request without a reasonable excuse, punishable by a fine. If your managing agent stonewalls you, refuses to produce receipts, or simply ignores your letters, remind them in writing that they are committing a criminal offence. That letter alone often produces a rapid change in attitude. If the issue is also about the agent’s conduct — poor communication, failure to respond, failure to provide accounts — see our guide to complaining about your managing agent for the parallel formal process.

How to make the request

Always put your request in writing. A clearly worded email or letter sent to the agent’s registered office, referencing Sections 21 and 22 of the Landlord and Tenant Act 1985, creates an undeniable paper trail. Send by recorded delivery or email with read receipt. When you attend the inspection, focus on spotting inflated contractor rates, duplicate invoices, costs that do not relate to your building, items outside the lease, and evidence that cheaper alternatives were available but ignored. Take clear photos of anything that supports your future Tribunal case.

Step 3: Pay under protest — then challenge

Your “under protest” letter should be concise and specific. State the amount you are paying, confirm you are paying under protest, identify which charges you dispute and why, and state that you intend to apply to the First-tier Tribunal under Section 27A. Send it to the agent on the same day you make payment, and keep a copy. The Upper Tribunal has confirmed that simply paying service charges does not automatically mean you have admitted they are reasonable — leaseholders routinely pay under protest precisely to avoid aggressive enforcement action.

Step 4: The First-tier Tribunal

What is the First-tier Tribunal (Property Chamber)?

The First-tier Tribunal (Property Chamber) is the specialist body that determines disputes about residential service charges in England. In Wales, the equivalent is the Residential Property Tribunal Wales. These tribunals were specifically designed to be accessible to ordinary leaseholders — you do not need a solicitor or barrister, and the process is deliberately less formal than a county court. You can challenge charges that have already been paid, charges currently demanded, or charges the landlord proposes to levy in the future.

How to apply (Section 27A)

You apply under Section 27A of the Landlord and Tenant Act 1985, which allows any party to a lease to ask the tribunal to determine whether a service charge is payable, and if so, by whom, to whom, how much, when, and in what manner. Complete the relevant application form (currently T541 for service and administration charges), available on the tribunal’s website, setting out the charges you are disputing, the reasons you believe they are unreasonable, and the evidence you intend to rely on. The application fee is typically in the region of £100 to £300 depending on complexity. The tribunal will then direct both parties to exchange evidence, and a hearing will be listed.

What to expect at the hearing

Hearings are conducted by a panel that usually includes a legally qualified chair and a surveyor or valuer with property management experience. The atmosphere is inquisitorial rather than adversarial — the panel will ask questions of both sides to get to the truth, rather than sitting back while lawyers cross-examine witnesses. You can represent yourself, and many leaseholders do so successfully. Bring your lease, the service charge demands, the summary of costs, any invoices obtained, comparative quotes from other contractors, and your correspondence with the agent. Organise your evidence in a clear, indexed bundle — preparation is the single biggest factor in a successful outcome.

The 2026 legal cost protection

This change is one of the most significant leasehold reforms in a generation. For years, the ability of freeholders to recover tribunal costs through the service charge acted as a powerful chilling effect on legitimate challenges. Leaseholders who suspected they were being overcharged would quietly accept it rather than risk a legal bill that dwarfed the original dispute. If you are considering a tribunal application, this reform should give you significantly greater confidence to proceed.

Section 20 consultation: your protection on major works

If your dispute involves a large one-off bill for major works — roof replacement, external redecoration, structural repairs — check whether the freeholder complied with the Section 20 consultation process. Where qualifying works will cost any individual leaseholder more than £250, the landlord must follow a prescribed procedure: notifying leaseholders of the proposed works, inviting them to nominate contractors, obtaining at least two estimates, and giving leaseholders an opportunity to comment before the contract is awarded.

If the landlord fails to consult properly, the maximum recoverable from each leaseholder for those works is capped at £250 — regardless of the actual cost. The landlord would need to apply to the tribunal for a “dispensation” from the consultation requirement, which the tribunal will only grant where it is satisfied that no leaseholder has been prejudiced by the failure. Non-compliance with Section 20 is one of the most common and effective grounds for challenging a major works charge.

Building a strong case: evidence tips

The Tribunal will be persuaded by clear, organised documents — not just understandable frustration. Start by creating a simple timeline showing when the demand arrived, when you requested information under Sections 21 and 22, what responses you received, and any follow-up correspondence. Gather and organise the following:

• The full service charge demand and any budget or year-end accounts supplied.
• A copy of your lease and any variation, with the key service charge clauses highlighted.
• All email and letter exchanges with the managing agent or freeholder about the disputed charges.
• Photos and videos showing poor workmanship, unresolved defects, or services not being delivered as billed.
• Alternative quotes from other contractors for comparable works, to demonstrate that the landlord’s contractors are overpriced.
• Notes from your Section 22 inspection, plus copies of suspicious invoices — repetitive charges, apparent double billing, or costs that appear to relate to another building entirely.

Present this material in a clear, paginated bundle with an index. It will make it far easier for the Tribunal to follow your argument and see where the landlord has failed to act reasonably.

The ultimate solution: fire the agent

Winning a single dispute at the tribunal is a relief — but it does not fix the underlying problem. If your managing agent routinely overcharges, fails to maintain the building, ignores your correspondence, or treats leaseholders as an inconvenience rather than the people who fund every penny of the service charge, then challenging individual invoices year after year is an exhausting, unsustainable strategy. You are treating the symptoms, not the disease.

The permanent solution is the Right to Manage (RTM). Qualifying leaseholders can collectively take over the management of their building without having to prove fault and without buying the freehold. You simply need to meet the statutory qualifying criteria and form an RTM company. Once the right is exercised, you can appoint a professional managing agent of your own choosing — one that is transparent, accredited, and accountable to the people who actually pay the bills. Once you have that control, our guide to choosing a block manager gives you the full vetting checklist: accreditations, fee structures, staff workload limits, and the six questions that reveal whether a prospective agent is worth appointing.

Frequently Asked Questions

This guide is general information about leasehold in England & Wales, not legal advice. Rules differ in Scotland and Northern Ireland, and leasehold law is changing — check your lease and current guidance, or take professional advice, before acting.

Last updated June 2026.