Service charges cover the cost of services provided to your home. It will vary from home to home but may include:
- Communal grounds and maintenance
- Cleaning of communal areas
- Repairs and improvements
- Maintaining door and gate entry systems
- Bin hires.
- Communal lighting, water and heating
- Communal building insurance
- Reserve fund/sinking fund towards the cost of cyclical repairs or major works
Depending on your agreement with us, services may be included in your rent or you may have a separate charge for them.
We operate a variable service charge policy, which aims to recover all service-related costs from those who benefit from them.
If you are on a fair rent, these are approved by the Valuation Office Agency every two years.
Service charge statements for leaseholders are subject to independent examination by a qualified auditor annually.
We calculate service charges based on quotes from our contractors or suppliers. If we do not receive one in time, we estimate the cost based on previous costs plus the September CPI inflation rate.
We then compare the estimated costs of last years’ service charges with how much it actually cost us. If we estimated less than what was spent, we return this to you by taking some of the cost of your current years’ service charge. If the actual cost was more than the estimate, and therefore wasn’t paid for last year, we will add this on to this year’s estimate.
The estimate details what we think services will cost over the next year.
The actual service charge details what was actually spent during that period.
You may find there is a difference here and this could be due to a variety of reasons. Where there is a difference, we will amend your next estimate to cover this, either recovering the cost or returning it back to you.
The adjustment process makes sure that service charges accurately reflect the true costs of services provided, maintaining fairness and transparency.
We estimate your service charge amount based on the actual spend on the previous year and any quotes we receive from our contractors. As we operate a variable service charges, the costs can change each year or vary throughout the year due to:
- Fluctuations in utility costs – increases or decreases in electricity, water or gas prices for communal areas can lead to higher or lower service charges.
- Changes in maintenance and repair costs – this includes costs related to maintaining communal areas such as cleaning, gardening, lift repairs, or increase wear and tear.
- Inflation and cost of living increases – general inflation will affect the price of services, labour costs, staff wages, materials, fuel, supplies etc, leading to a change in costs.
- Changes in service levels – if additional services are introduced, these costs may be passed on to residents, such as a new cleaning contract, CCTV service or upgraded communal areas. Similarly, if any services are discontinued, the cost will be removed.
- Regulatory and compliance requirements – new government regulations or safety requirements may mean an increase service charge. This includes fire safety measures or health and safety upgrades.
Over the past year, we’ve continued to see an increase in the cost of living, materials, supplies, fuel and wages which all affect the cost of the services we provide to you.
In your annual service charge estimate letter, you’ll find a breakdown of the services you receive and the costs.
We do our best to make sure you get value for money by regularly reviewing contracts, making efficiencies and tailoring our services to what you need. The increase helps to cover the cost of your services and allows us to continue investing more in your communal spaces and shared services and be proactive, helping reduce repairs and ensure your homes are safe, secure, and of a good quality.
If we don’t receive payment, we will contact you to talk through a plan to get back on track. If we can’t get in touch or the amount remains unpaid, we will seek legal advice in order to recover what is owed.
We’ll consult with you on any changes where it is either a new service will cost you £100 a year or more.
If you are a leaseholder, we’ll also consult with you if we are planning to enter into a new contract which will cost you £250 or more.
For example, if we were to introduce CCTV at your site where there wasn’t this service previously, we would consult with residents to make sure you are happy for this to begin and are aware of the costs involved.
If you spot an issue with your service charge, please contact us on 0800 054 6710 or email customers@ccha.biz.
Your service charge estimate will have come with a document called ‘Service Charges – Summary of tenants’ rights and obligations’ which details options for challenging your service charge.
Some residents pay service charges within their rental amount, rather than separately, so won’t receive schedule. This applies for residents on Affordable Rents or London Living Rents.
Service charge glossary
This is a fee we pay to our external auditors to ensure the charges are correct and fair. We are required to do this under the terms of your lease.
This charge is shared equally amongst all our leaseholders and shared owners and is based on the actual cost we incur.
This is the cost to insure your building against risks such as fire or water damage.
This charge is shared equally based on the number of units in the block, per tenure. We estimate the cost based on next year’s expected insurance premiums.
This is the cost of running our services, including our welfare advice team, statement production, communication, accounting, general overheads, debt recovery, legal fees, IT and consultations etc.
This charge is split equally between all residents and allocated per home. The charge is 15% of the services delivered to you, excluding other fees such as buildings insurance, audit fees, ground rent, personal heating and personal water rates or any sinking fund or third part fees.
This cost covers the monthly maintenance and inspection of communal lifts as well as the cost of the call-out service for broken lifts and the telephone for emergency calls. We must remain compliant by having lifts inspected by certified engineers who are independent from those who carry out routine repairs or maintenance.
This charge is allocated per block which have lifts and the cost shared equally between you and your neighbours.
This cost is for providing treatment to remove infestations such as mice, rats or bed bugs as well as preventative treatments such as sewer baiting. While your service charges usually only cover communal areas, pest control in rent homes is included in this charge as pests can likely spread to neighbours if not treated quickly.
This charge is allocated per block and split between you and your neighbours.
This cost is for heating, electricity or water which related to your home, as opposed to the communal areas. Each tenant will pay towards the amount that is collectively used.
This charge is split between all tenants, depending on how many bedrooms you have.
Older persons and supported schemes are allocated based on how many rooms there are in the property, as opposed to the number of bedrooms.
This cost is for cleaning the windows on the outside of the block. You are responsible for the windows inside your home.
This cost is allocated per block and split between you and your neighbours.
The freeholder may employ a management company to provide some or all of your services. This cost includes the service charges ccha pays directly to them.
This charge is allocated per block, meaning the cost is split between you and your neighbours.
If you are a leaseholder, you may need to liaise with the management agent directly. However, if you rent from ccha, we will be your contact and liaise with the managing agent.
The purpose of a sinking fund is to help build a fund for larger scale works such as [please insert examples here], so that you don’t have to pay a large one-off bill when works need doing.
