We are an RTM company and we issue our own service charge demands. A leaseholder has written to say our demands are invalid because they do not include the right information. What actually has to appear on a service charge demand, and what happens if something is missing?
A valid service charge demand must first comply with the lease, which creates the liability and sets out the demand machinery. It must then satisfy section 47 of the Landlord and Tenant Act 1987, which requires the landlord's name and address to appear on the demand; section 48 of the same Act, which requires the landlord to have furnished the tenant with an address in England or Wales for service of notices; and section 21B of the Landlord and Tenant Act 1985, which requires the demand to be accompanied by the prescribed summary of tenants' rights and obligations. Where these requirements are not met the sum is generally treated as not due, or may be withheld, until the position is put right. Section 20B separately controls how soon after costs are incurred the demand must be served.
There is no single statutory form for a service charge demand. Validity is built up from four separate layers, and a demand has to survive all of them:
Separately, section 20B of the 1985 Act controls *when* the demand has to be served, and section 19 controls how much is ultimately payable. Those are timing and quantum questions rather than questions about the contents of the document.
The most common mistake directors make is to treat this as a purely statutory checklist. It is not. The lease is the source of the obligation to pay, and it usually specifies who demands, when, in what form, and on what notice.
*H Stain Ltd v Richmond* [2021] UKUT 66 (LC) is a useful illustration. The lease required not less than one month's notice before an advance service charge contribution became payable. The demand gave payment terms of 30 days from the date of the demand, which on the facts amounted to slightly less than the month the lease required. The Upper Tribunal upheld the conclusion that the sum was not payable as demanded, and that the shortfall could not be cured by reading the demand purposively under the "reasonable recipient" approach.
The practical point is blunt: a demand that ignores the contractual machinery can fail even if every statutory box has been ticked. Read the lease before designing your demand template.
Section 47 of the Landlord and Tenant Act 1987 requires any written demand given to a tenant of premises containing a dwelling to contain the name and address of the landlord, and, where that address is not in England or Wales, an address in England or Wales at which notices may be served.
Two points cause most of the problems.
It must be the landlord's own address, not the agent's. In *Beitov Properties Ltd v Martin* [2012] UKUT 133 (LC) the demands gave the landlord's correct name but the managing agent's address. The Upper Tribunal held that this did not satisfy section 47(1). The subsection means what it says: the landlord's address. Where a landlord genuinely has more than one address it may choose which to use, but an agent's address alone will not do.
It must be the right landlord. In *Lehner v Lant Street Management Co Ltd* [2024] UKUT 135 (LC) the demand named the freeholder as landlord when in fact an intermediate management company holding the intermediate lease was the leaseholder's landlord. The Upper Tribunal held the demand had not complied with section 47(1), with the consequence that the sum demanded was not payable, and would not be payable until a demand correctly identifying the landlord was provided.
For RTM companies and RMCs this is worth pausing on. Who the "landlord" is for section 47 purposes is determined by the lease structure, not by who happens to be doing the managing. Where an RTM company manages but does not own the reversion, the landlord for section 47 purposes is usually still the freeholder or intermediate landlord, and the demand should identify them correctly. If you are unsure how your structure works, that is a question worth resolving before the next demand run rather than after.
Consequence of getting section 47 wrong. Under section 47(2), where the required information is not given, any part of the amount demanded which consists of a service charge or an administration charge is treated for all purposes as not being due until the information is furnished. The obligation is suspended, not extinguished: a compliant demand can generally be issued later, subject to section 20B and the lease.
Section 48 of the Landlord and Tenant Act 1987 requires the landlord to furnish the tenant by notice with an address in England or Wales at which notices, including notices in proceedings, may be served on the landlord.
Section 48 is often confused with section 47, but they do different jobs and have different consequences.
In practice most well-drafted demands satisfy both by carrying the landlord's name and address and a clearly labelled address for service. That is sensible practice, but the two requirements remain legally distinct, and a section 48 notice does not have to be on the demand itself.
Section 21B of the Landlord and Tenant Act 1985 requires a demand for payment of a service charge to be accompanied by a summary of the rights and obligations of tenants of dwellings in relation to service charges. The form and content of that summary are prescribed by regulations.
For England the relevant regulations are the Service Charges (Summary of Rights and Obligations, and Transitional Provision) (England) Regulations 2007 (SI 2007/1257). For Wales they are the Service Charges (Summary of Rights and Obligations, and Transitional Provision) (Wales) Regulations 2007 (SI 2007/3160). The Welsh version is not interchangeable with the English one.
Under section 21B(3) the tenant may withhold payment of a service charge which has been demanded if the demand does not comply, and any provision of the lease relating to non-payment or late payment - such as interest or default charges - has no effect in respect of the period for which payment is withheld.
Three points of practice:
This question comes up frequently, and the answer as at the date of this article is narrower than many people expect.
The Building Safety Act 2022 inserted sections 47A and 49A into the Landlord and Tenant Act 1987. These would impose additional demand and information requirements in relation to relevant buildings. However, those provisions have been commenced only for the limited purpose of making regulations. They are not, as at the date of publication, fully in force, and no regulations bringing the substantive requirements into effect have been made.
The practical position is therefore:
We will update this answer if and when sections 47A and 49A are brought fully into force.
A demand can contain every required item of information and still fail because it was served too late. Section 20B of the Landlord and Tenant Act 1985 generally prevents recovery of costs incurred more than 18 months before a demand is served, unless a compliant written notification was given within that period.
The two topics interact. In *No. 1 West India Quay (Residential) Ltd v East Tower Apartments Ltd* [2021] EWCA Civ 1119 the Court of Appeal held that a demand for the purposes of section 20B(1) must be a contractually valid demand served in accordance with the service charge provisions of the lease. A defective demand may therefore fail twice over: it does not create a payable liability, and it does not stop the 18-month clock.
Our separate answer on the 18-month rule for service charges deals with that timetable in detail.
Validity of the demand and reasonableness of the sum are different questions. Section 19 of the 1985 Act limits relevant costs to those reasonably incurred, and to works and services of a reasonable standard. A perfectly formed demand for an unreasonable sum is still challengeable under section 27A, and a defective demand for an entirely reasonable sum is still defective.
Subject always to the lease, a well-constructed demand will usually show:
This is a working checklist, not a statutory form, and it does not replace advice on your particular lease.
Usually the obligation to pay is suspended rather than destroyed. Sections 47(2) and 48(3) both operate by treating the sum as not due until the required information is furnished, and section 21B(3) entitles the leaseholder to withhold payment while the demand does not comply.
That is reassuring but not a reason to relax. A suspended charge is not a collected charge, and while it is suspended:
The right response to a challenge is to review the demand, correct it, and reissue properly, rather than to argue about the original.
Resident-led companies are held to the same standard as professional landlords. Volunteer directors do not get a lower bar for compliance.
The practical risks we see most often are demands that carry the managing agent's address instead of the landlord's, demands that name the wrong entity as landlord after a change of structure, demands issued without the prescribed summary, and demands that ignore a notice period buried in the lease. Each is easily avoided with a correctly built template and a proper check of the lease.
Reliable service charge management and disciplined RTM company management are largely about getting this right every time, quietly, rather than fixing it after a challenge. Where a block has recently changed agents, our managing agent handover checklist covers the demand records and templates that should be requested from the outgoing agent. Our answer on late service charge demands covers the related question of what the dates in your lease require.
We review demand templates against the lease as a matter of course when we take a block on, because it is far cheaper than dealing with a challenge later. If you are an RTM or RMC director and a leaseholder has questioned the validity of your demands, or you simply want your template checked before the next billing run, we are happy to take a look.
Most invalid demands are not caused by obscure law. They are caused by a template that was never checked against the lease, or that carries the managing agent's address instead of the landlord's.
Using the managing agent's address as the landlord's address
Section 47(1) requires the landlord's own address. Beitov Properties Ltd v Martin held that giving the agent's address does not satisfy the subsection.
Naming the wrong entity as landlord
Where there is an intermediate lease, the leaseholder's landlord may not be the freeholder. In Lehner the demand named the freeholder and the sum was held not payable until a correct demand was served.
Treating the statutory checklist as the whole answer
The lease comes first. In H Stain Ltd v Richmond a demand failed because it did not give the notice period the lease required, and the shortfall could not be cured by purposive construction.
Omitting the prescribed summary of rights and obligations
Section 21B requires the summary to accompany the demand. Without it the leaseholder may withhold payment and lease provisions on interest and late payment have no effect for that period.
Using the English prescribed summary for a Welsh property
England and Wales have separate 2007 regulations prescribing the summary. They are not interchangeable.
Assuming a defective demand still stops the section 20B clock
West India Quay confirms that a demand for section 20B(1) purposes must be a contractually valid demand served in accordance with the lease.
Assuming new Building Safety Act demand requirements already apply
Sections 47A and 49A of the 1987 Act are commenced only for the purpose of making regulations and are not fully in force. Schedule 8 leaseholder protections are a separate matter and may still apply.
Most questions on this topic are management questions rather than legal ones, and the two are worth separating. A managing agent can tell you how something works day to day and what it will cost. A solicitor tells you what your rights are and how a Tribunal is likely to view them.
East Valley Properties provides management expertise, not legal advice. Where a matter turns on the wording of your lease or on formal proceedings, we will say so and work alongside your solicitor.
The official material behind this guide. We summarise it in plain English rather than reproducing it.
Requires the landlord's name and address on any written demand, and treats the sum as not due until given.
Requires the landlord to furnish an address in England or Wales for service of notices; suspends rent as well as service and administration charges.
Inserted by the Building Safety Act 2022. Commenced for the purpose of making regulations only; not fully in force at the date of publication.
Requires the prescribed summary of rights and obligations to accompany a service charge demand, and permits withholding if it does not.
The 18-month time limit for demanding relevant costs.
Limits relevant costs to those reasonably incurred and to a reasonable standard.
The tribunal's jurisdiction to determine whether a service charge is payable.
Prescribes the form and content of the summary for England.
Prescribes the form and content of the summary for Wales.
Administration charges, including the separate prescribed summary requirement.
Leaseholder protections restricting the recovery of certain remediation costs through the service charge.
Upper Tribunal (Lands Chamber). Section 47(1) requires the landlord's own address, not the managing agent's.
Upper Tribunal (Lands Chamber). Demand naming the freeholder rather than the intermediate landlord did not comply with section 47(1); sum not payable until corrected.
Upper Tribunal (Lands Chamber). Demand failed to give the notice period required by the lease; not cured by purposive construction.
Court of Appeal. A demand for section 20B(1) purposes must be a contractually valid demand served in accordance with the lease.
Clear budgets, designated client accounts and year-end accounts leaseholders can actually follow. We can review your current arrangement at no cost.
Answered by Romain Maillard - Director, East Valley Properties
Romain manages residential blocks and estates for RTM companies, residents' management companies, share of freehold developments and freeholders across East London and Essex.
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This answer has been anonymised. Personal details, addresses and company names have been removed. Guidance is general and does not replace advice from a solicitor or surveyor on your specific block. East Valley Properties is a managing agent, not a firm of solicitors or legal advisers.
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