Service charge monies held in trust are protected by the FSCS and guidance on claims was put out in April 2009 by the Communities and Local Government Dept. It said:
“Whilst any claim would be dependent on the circumstances and evidence available at the time of the claim, the FSCS would generally expect to treat the tenants not the landlord as being individually entitled to the protection available for that proportion of the money in the account to which they were entitled by statutory trust. This would mean each tenant being eligible for a maximum of £50 000 compensation to cover the loss of their particular proportion of the deposited funds.”
The protection limit has been increased from 30th January 2017, to £85 000.