Leaseholder Service Charges
The Service Charges
Your service charge is the money you pay towards the day to day running costs, incurred by Estuary, for the scheme or property where you live. These can be fixed or variable. We estimate the costs of running the services you receive at the beginning of the year.
Our aim is to set an estimated account that is as close as possible to the actual costs of providing the service. The estimated figure is based on the actual costs of the previous years and known costs such as cleaning or gardening. A sum for inflation may also be included.
- Depending on your individual lease, and the type of home you live in service charges may include the all or any of the following:
- Building insurance (not contents insurance)
- Day to day maintenance of communal areas and the main structure
- Cleaning of communal areas
- Gardening of communal areas
- Maintenance contracts, e.g. entryphone, lifts etc.
- Fees to accountants, surveyors etc
- Administration charge on the costs of the above items
- VAT where applicable
- When services are not provided by Estuary, but a managing agent or management company, we will pass on these costs
- Contribution to reserve fund also referred to as a ‘sinking fund’. Please see below for details
- Management fee to Estuary.
Some shared owners, for example where purchased under the DIYSO scheme, may not have charges other than building insurance levied, whilst other shared owners may be liable for other service charges
A sinking fund is basically a “savings” account for your scheme or the estate in which you live. It is there to help pay for planned major work, like replacement windows or roof. If the sinking fund has adequate money held in it, then we will not have to ask you for an additional payment to undertake these works. If there is not enough then we will invoice you for the shortfall and will advise you when payment needs to be made.
Contributions to the sinking fund are generally not repayable when a property is sold.
Variable service charges
This means that, although you pay the same service charge each week or month, the service charge is not fixed for the financial year (1 April to 31 March). Once the financial year has ended, we will check the amount that has been spent at your scheme or property. We will see if there is a credit or debit on the service charge account.
As the charge is not fixed it means any credit will be refunded to you. However if there is an underpayment (debit) you will be required to pay an additional amount.
Fixed service charge
A fixed charge means that you pay an amount every week or month. This figure does not change during the financial year. A fixed charge is based on how much we know or estimate it will reasonably cost to run the services at you scheme or property. Any shortfall will be accepted and paid for by Estuary, but any surplus will not be refunded.