SERVICE CHARGE BACK CHARGES – an update for Leaseholders
Recently (Spring 2026), many leaseholders have received backdated service charge demands (chargebacks) covering a period of several years.
Not all buildings or flats appear to be badly affected and the amounts vary significantly. Some have received relatively modest charges, while others are facing bills running into several thousand pounds.
We are actively raising this with Ballymore and it is a key focus of ongoing discussions.
There is some legal analysis in this document. There are lawyers on the RA committee but no specialist landlord and tenant lawyers – so it is important that you take your own legal advice and do not rely on these very general statements.
How this has come about?
The six-monthly bills you get are, technically, merely estimates. The final bill, often known as a balancing charge, records actual expenditure and is a request for further money or (sometimes!) a credit if the final expenditure is over, or (sometimes!) under, the provisional six-monthly estimates for the relevant year.
The landlord (i.e. the freeholder or freeholders) is obliged to send the balancing charge demands or credits within six months of the end of the relevant financial year. Our financial years are calendar years, so balancing charges for, for example, 2024 should have been submitted to leaseholders by 30 June 2025. If they aren’t sent by then, the leaseholder is not obliged to pay the balancing charge.
BUT, if the balancing charges are not ready within that six-month time limit, then the landlord can send a notice to the leaseholders telling them that the final accounts are not ready. This is called a section 20B notice after the section in the Landlord and Tenant Act which deals with it. If they do that, then the six-month time limit does not apply. Ballymore maintain that they have sent Section 20B notices in time to everyone on the development, and some residents have confirmed they received them.
If your balancing charge is a credit then most leases state that this will be deducted from your next service charge demand rather than being refunded to you.
What you can do about it
If you are a leaseholder and you think you haven’t received Section 20B notices for any of the five years for which you have been charged balancing charges, then you are entitled to ask Ballymore for proof that they sent them. A court, which judges these things on the “balance of probabilities”, i.e. which side is more than 50% likely to be right, will probably say that it is more likely than not that the notices were received if Ballymore produce:
- a screenshot of what they say they sent you
- proof that their mailing company sent them out
- proof of payment of the postage.
This is even more likely be the case if is known that others in the same building received the notices.
On the assumption that you have received the Section 20B notices, or at least cannot prove that you didn’t, then you do have the right to inspect the “accounts, receipts and other documents” which make up the service charge, and challenge them if they are not reasonable.
The right to ask for this is from a section of the Landlord and Tenant Act called a Section 22 notice. There is a time limit of six months after receipt of the balancing charge demand to ask for this.
What we’re hearing from you
A number of common themes are emerging:
- Wide variation in charges, depending on building and flat type
- Charges issued several years after the costs were incurred
- Limited transparency on how the figures have been calculated
- Missing or unclear supporting information, including lack of detailed breakdowns
- Concerns about whether Section 20B notices were issued correctly and within the required 18-month timeframe
Residents’ and Leaseholders’ Association (RA) support
The Association is completely independent from Ballymore and the managing agent. We are a voluntary group made up of residents, and in fact, many of us on the committee have received substantial chargebacks.
We recognise the level of concern and frustration because we are experiencing it first hand ourselves.
We, the RA, have been promised a detailed analysis of all the relevant invoices etc. with how they were allocated.
This is front and centre of all our (the RA’s) meetings with Ballymore at the moment and we will keep people informed.
Our suggestion is to hold off making individual Section 22 requests until you are closer to your six-month cut off. If no further information has been provided by then, then you should get in touch with Ballymore to protect your position before the deadline expires. But as we said, do not rely on the RA for legal advice.
We strongly advise you to document clearly all your own communications with Ballymore. If something is said to you on the phone, confirm it in writing.
What leaseholders are doing
Outside the official RA, leaseholders are already taking steps to understand and, where appropriate, challenge these charges, such as:
- Requesting copies of Section 20B notices for each relevant year as outlined above
- Asking for proof of delivery and supporting documentation
- Comparing experiences across buildings to identify patterns
- Exploring potential First Tier Tribunal challenges, particularly where notices may not have been issued correctly or charges have been incorrectly allocated.
What if you moved in after the date of the balancing charges
Lastly, If you have moved in after the period covered by the balancing charges. Although the current owner is obliged to pay, then normally your solicitors would have advised you on keeping a retention from the purchase price for the previous leaseholder to pay. You would need to talk to your solicitor about that, of course.
Staying connected
There is a group of residents who think they have not received section 20B notices and are considering collective action and taking legal advice collectively. This is separate from the RA.
A WhatsApp group has been set up to share information and updates among residents.
If you would like to join that discussion, you can do so here: https://chat.whatsapp.com/D4WBdxqrboALvY0yM1NlyC