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You may pay service charges in addition to your rent to maintain communal areas of your building and estate.
Our video explains what a service charge is, who pays them, and the three types of service charges you’ll find at Moat.
You’ll find even more details in our ‘Service Charges Explained’ booklet.
As a Moat customer, you’ll pay one of three types of service charges: a variable service charge, a fixed service charge or an actual service charge. You’ll find information on which type you pay in your lease or tenancy agreement.
The way we calculate your charges depends on the type of service charge you pay.
Variable service charges are based on the actual cost of service you receive. We estimate these charges in February then confirm in September how much was actually spent.
We estimate your service charge based on spending from the previous year. We factor in any expected changes to services, contract costs, VAT and inflation or any expected communal works coming up.
At the end of the financial year (usually 31 March), we will check the actual service charge spend for your communal maintenance and compare it with the estimated charges you’ve paid during the year. Once this comparison is complete, it will show whether the actual spend was more or less than the estimated charges. You may owe us money, or we may owe you money; we will send you a year-end statement to show you any difference, usually by the end of September each year.
If we have spent less than we estimated, we’ll pay back the money we owe – either as a credit to your account or carried forward to the next year, depending on your lease or tenancy agreement. This is known as a surplus.
If we have spent more than we estimated, we will apply a debit to your account or carry it forward to the next year, depending on your lease or tenancy agreement. This is known as a deficit.
The way these adjustments are collected or refunded depends on the type of tenancy you have, and we’ll always provide this information when we send your year-end statements.
If you rent your home, please be aware that if you wish to move home during the year, the surplus or deficit should be paid or refunded before you leave your home.
Some managing agents operate on the same financial year as Moat (April to March) so their year-end accounts may not be ready when we calculate and send out your service charge statement. As a result, we estimate any costs which we believe they will charge you in the coming year, so your service charges are as accurate as possible.
These are set at the beginning of a financial year, and no extra costs or refunds will be charged during the year. Each year, our team calculates the cost of maintaining a particular neighbourhood and sets the service charge for that area. Every February, we’ll let you know of your service charge costs for the year.
These apply to a very small number of our homeowners (1%) and are used when there is an agreement which does not allow us to charge estimated costs. If you fall into this group of people, you’ll receive a service charge statement within six months of the end of the financial year (31 March) which shows the actual cost of the services provided. We’ll charge you for these services in line with the agreement.
You may live in a building with a managing agent who carries out some or all communal maintenance services on behalf of the freeholder of the building.
The managing agent will send us their year-end accounts and we will pass these costs on to you via your service charges. We currently charge a 5% management fee for dealing with the managing agent on your behalf and completing all related service charge administration.
We conduct estate inspections of the buildings and estates we manage, and these are carried out monthly, bi-monthly or quarterly. During these inspections, we review the cleanliness and condition of your communal areas to make sure you're receiving the services you should.
If we provide services to the building you live in or the areas surrounding your home, we’ll also gather your feedback in a number of ways to make sure you’re satisfied with the services you pay for:
We use your feedback to identify and address areas for improvement, working closely with our suppliers.
If your building is run by a managing agent, we take your queries or concerns forward with the managing agent to make sure they are addressed.
We work with our colleagues at Moat, as well as with external agencies, to ensure the cost of services (including major works) to your neighbourhood is reasonable. For example, our communal cleaning and grounds maintenance suppliers are selected through a comprehensive tender process. During this process, we evaluate how they provide good value for money.
For our homes with managing agents, we closely monitor their service levels and expenditure. Managing agents provide us with invoices for all services which our Finance team will check. We challenge costs we think are unreasonable and also have the right to make official complaints against the managing agent or take them to the First-tier Tribunal.
If you are eligible, Universal Credit will cover most, but not all, service charges. You’ll need to provide the Department of Work and Pensions (DWP) with proof of your service charges, such as the rent and service charge notice we send you in February.
We don’t make any profit from the service charges you pay. The money we receive is used to pay for the services provided and our management charge.
If you moved into your home between 1 April and 31 March of the following year, you’ll pay service charge costs for the full year. You can contact the solicitor who acted on your behalf when you purchased your property, to request the former owners’ share of the costs. It is common practice for solicitors to hold this money (known as a ‘retention amount’) for this purpose.
We always aim to provide a service which meets the needs of our customers and also offers value for money. However, if you feel we’re not providing you with the service you expect, please contact us. We can make mistakes and we’ll look into your query and get back to you.
If you’re dissatisfied with our response, you have the right to appeal to the First-tier Tribunal (Property Chamber) which will determine if the service charge is reasonable. To do this, you’ll need to complete an application form and return it to the appropriate regional Tribunal office. Please note that you will need to pay a fee to submit an application. You can find more information on this process at lease-advice.org.
Your service charges will change as service costs, VAT, building insurance and inflation change. We will also review contributions to Future Repair Funds (also known as Reserve Funds) and these may change to cover future planned or major works.
You’ll pay service charges if your freehold home is on an estate that we own and maintain. These charges will cover maintenance of communal areas you use or have access to, such as ground maintenance.
A Future Repair Fund is not used for day-to-day maintenance of your building or estate. It's a savings fund which is set aside for one-off works, such as roof repairs, redecoration or communal window replacement.
We are obliged under the terms of your lease to ensure your home has adequate buildings insurance. We currently collect this cost monthly via your service charge. Once you own your home outright, we will stop charging for this as you will become the freeholder and be responsible for your own buildings insurance. Please see Moat | Insurance