Leasehold Service Charges Mandatory Capping Policy

2017/18

Debt Management – Write off Policy
Author: / P Meyer / Authorised by:
Owned by (Team/Dept): / Income & Home Ownership / Issue No: / 2.0
Effective from: / Next Review date:
Consultation Required? / yes / List who was consulted / internal
EqIA Required? / no / EqIACompleted / n/a
Section: / Corporate/Finance
Applies to: / All housing related debts

Page 1 of 4

Contents

1.Purpose

2.Definition

3.Legislative/Regulatory Framework

4.Linked policies

5.Scope

6.Policy

7.Value for money

8.Version control

1.Purpose

This policy sets out Homes for Haringey’s approach to capping leasehold service charges, where this is mandatory.

2.Definition

Under the terms of the standard Haringey Right to Buy Lease, leaseholders are required to pay towards the cost of services and works to their building and estate. These are referred to as “service charges”.

There are regulations which require service charges to be capped when certain criteria are met.

3.Legislative/Regulatory Framework

  • The Landlord and Tenant Act 1985
  • Commonhold and Leasehold Reform Act 2002
  • The Social Landlords Mandatory Reduction of Service Charges (England) Directions 2014

4.Linked policies

N/A

5.Scope

This policy appliws to all service charges for repairs, maintenance or improvement where the works are funded from certain sources, as outlined in the 2014 Directions

6.Policy

The directions require the landlord to cap leaseholder contribution for major works over a five year period to a maximum of £15,000 in London, where the property is the leaseholder’s only or principla home.

The capping only applies to works that are funded from particular sources. These are:

  • the Decent Homes Backlog Funding provided through the 2013 Spending Round; and
  • any other assistance for the specific purpose of carrying out works of repair, maintenance or improvement provided by—

any Secretary of State ; or

the Homes and Communities Agency

7.Value for money

The policy offers value for money by ensuring that Homes for Haringeyfollows Government policy and is not subject to challenge from leaseholders.

8.Version control

Revision / Date / Description of changes / Consultation? / Reviewed by
1.0 / 06/03/17 / Initial Release / M Bester

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