Do you know what S20 is?

Hardhat, drawings & pen  S20 is part of the legislation which was designed to ensure that managing agents could not spend large amounts of money either on major works or long term contracts without the knowledge and input of the residents.  There is a set procedure of consultation which has to be followed during which residents can put forward their reservations, queries and objections.

However it is a common misconception that the billing for major works may only take place after S20 consultation.  This is not correct.  The practice of issuing special levies for major works is usually not compliant with the terms of leases unless there is a lease clause allowing special levies.  It is perfectly correct to add the estimated cost of major works to the annual budget and then collect the monies due as part of the service charge (or explaining that reserve funds will be used) BEFORE commencing S20 consultation.

So there are indeed 2 aspects to costs for major works and long term leases.  It must be allowed in the lease AND if the costs are more than £100 per resident for long term contracts and £250 per resident for major works the S20 procedures have to be followed.

 

 

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