Can My Service Charge Go Up Every Year? (UK 2026)

Can my service charge go up every year?

Short answer: yes — and in most well-run buildings it usually does, broadly in line with inflation. The longer answer is that there are real legal limits on how much it can rise, and you have real rights when an increase doesn't pass the smell test.

If your annual service charge has just landed and the number is significantly bigger than last year's — this post is for you.

For the full context on how service charges work, see our pillar guide: Service charges explained.

Why service charges go up

Service charges are a share of actual costs. So they go up when those costs go up — which, for a typical UK block, happens for a handful of reasons:

• Buildings insurance has risen sharply since 2022, especially for blocks with cladding issues
• Utility costs for communal lighting, lifts and heating
• Contractor labour rates for cleaners, gardeners and maintenance
• Compliance — newer fire safety, EICR and lift inspection requirements
• Major works funded in-year rather than from reserves
• Reserve fund top-ups as the next big project (roof, redecoration) gets closer

A 3–8% increase year-on-year is normal for a well-run building. A 30% increase needs an explanation.

Is there a legal cap on increases?

There is no automatic statutory cap on how much a service charge can increase year to year. Your protection comes from three places:

1. The lease. Some leases include a cap or an RPI-linked increase formula. Read yours — many don't.
2. The reasonableness test (section 19 of the Landlord and Tenant Act 1985). Charges are only payable to the extent they are reasonably incurred and the works or services are of a reasonable standard. "It's in the budget" is not a defence.
3. Section 20 consultation. If the increase is driven by works costing more than £250 per flat, or a long-term agreement costing more than £100 per flat per year, the landlord must consult leaseholders first. If they don't, the recoverable amount is capped at those figures — regardless of actual cost.

When an increase is reasonable

An increase is usually reasonable when:

• The landlord can show you the underlying costs and they line up with the demand
• The increase reflects market-wide rises (insurance is the classic example right now)
• The work was necessary, properly procured, and of a reasonable standard
• Where required, the section 20 consultation was followed

When an increase is not reasonable

An increase is arguably unreasonable when:

• The landlord won't show you the invoices behind the budget
• A contractor's price is well above market and there's no evidence of competitive procurement
• Works are being done that aren't required by the lease (improvements rather than repairs)
• A long-term agreement was entered into without the section 20 procedure
• The reserve fund is being topped up for works that may never happen

If any of these apply, you have a route.

What to do if yours has jumped

The sensible order is:

1. Ask for the budget breakdown

Write to the landlord or managing agent and ask for a line-by-line breakdown showing this year's budget against last year's actuals. A competent manager should be able to send this within a few days.

2. Request the section 21 summary

Under section 21 of the Landlord and Tenant Act 1985, you can request a written summary of service charge costs for the last accounting period. The landlord must provide it within one month. This gives you the audited "what was actually spent" number to compare against the budget.

3. Inspect the invoices

Under section 22, you can require facilities to inspect the underlying invoices within six months of receiving the section 21 summary. This is where you find out whether the increase is real costs or padded ones.

4. Check section 20 was followed

If a big chunk of the increase is driven by works over £250/flat or a long-term contract over £100/flat/year — the landlord must have consulted you under section 20. If they didn't, the recoverable amount per flat is capped.

5. Apply to the Tribunal if needed

If you can't resolve it informally, you can apply to the First-tier Tribunal (Property Chamber) under section 27A for a determination of whether the charge is payable and how much. Application fees are modest (typically £100–£300) and you don't normally need a solicitor.

What you should not do

• Don't just stop paying. Withholding payment without following procedure can trigger forfeiture proceedings.
• Don't rely on "the landlord said so". Service charges are creatures of the lease and statute — not of what the agent tells you.
• Don't assume the budget is the bill. If the year-end accounts come in lower than budget, you are owed a credit. Many leaseholders never check.

Where Proppa comes in

Most service charge disputes start with one thing: leaseholders can't see what's being spent. Proppa is built so small self-managed blocks (3–15 flats) run the service charge transparently — every spend logged against the budget, every invoice attached, every leaseholder able to see the running total at any time. It's much harder to have an unreasonable-charge dispute when everyone can see exactly where the money is going. Book a demo. First month free for founding blocks at launch.

Frequently asked questions

Is there a legal maximum service charge increase per year?

No, there is no statutory annual cap. Your protection is the reasonableness test under section 19 of the Landlord and Tenant Act 1985, the section 20 consultation rules for larger items, and your right to challenge unreasonable charges at the First-tier Tribunal.

Does my landlord have to justify a service charge increase?

Yes. You can request a written summary of accounts under section 21 and inspect the underlying invoices under section 22. If the landlord cannot or will not justify the increase, that is strong evidence to take to the Tribunal.

What is a reasonable service charge increase?

Broadly in line with cost inflation for the items in the budget — usually 3–8% a year in normal conditions. Larger one-off increases driven by insurance hikes, compliance work or planned major works can be reasonable, but should be capable of explanation.

Can I refuse to pay an increased service charge?

You should pay the undisputed portion and formally challenge the disputed portion through the proper route — usually a Tribunal application under section 27A. Withholding payment without following procedure can trigger forfeiture proceedings against your lease.

What if my service charge has doubled?

A doubling is unusual and warrants immediate scrutiny. Request the budget breakdown, the section 21 summary and a section 22 invoice inspection. Check whether section 20 consultation was required and followed. If you can't resolve it informally, apply to the First-tier Tribunal.