Service charges

question

Service charges cover maintenance and repair work in communal areas. The landlord pays them and asks his tenant to pay part of them back. Tenants pay them as a complement to the rent and they must be clearly mentioned separately from the rent in your lease agreement.

Which charges are attributable to the tenant?

All service charges relative to housing can’t be assigned to you. Basically, the charges that are yours to pay cover maintenance expenses in communal areas (cleaning, elevator maintenance, maintenance of gardens, upkeep of communal heating systems…), minor repairs and tax on domestic waste collection. We say these charges are recoverable (your landlord recovers them from you).

However, major construction work and maintenance are not yours to take in charge. You can replace the tap’s seal, but if the whole tap is to be replaced, your landlord has to handle it.

How do I pay service charges? 

You must wonder how payment of service charges is conducted. There are a few different scenarios for that:

  • Either you pay them directly to an institution (such as electricity or water providers), and your landlord occasionally asks you to repay the charges that he personally received, such as the tax on domestic waste collection. When he sends you request for payment of charges in dribs and drabs, he should also send you evidence he received and paid the charge himself.

  • Or you pay him a provision for charges: an advance anticipating charges the lessor will receive. You pay a little part of this advance every month, in addition to the rent. Once a year, adjustment of charges occur: if the landlord paid less charges than what you paid throughout the year, he owes you money. Reversely, you owe him money if he’s paid more than the provision you paid over the year.

  • If (and only if) you’re flat sharing or in a furnished apartment, you can also pay your landlord a fixed monthly fee. Just like the provision for charges, it’s an estimation of the service charges you’ll be accountable for, except there is no adjustment. Which means you won’t be able to reclaim the difference if your landlord paid less charges than what was covered by your monthly payment for charges. This goes for your landlord too: he can’t retrieve charges if he paid more than what your monthly fee provided for. Double or quits!

Paying a fixed fee is the most practical solution as there’s nothing to adjust later on. You just have to be careful that the fee isn’t excessive compared to actual charges. Tax on domestic waste collection should also be included in the forfeit, your landlord can’t reclaim it separately.

How much is it going to cost? 

Service charge amount to €46,77 on average per square meter a year for a fully equipped condominium. Based on this average, you’d pay about €935 a year for charges for a 20m2 apartment, so around €77 a month. It’s only an estimation, and this amount can be downsized if your building has less equipments and needs less maintenance.

In any case, you’ll notice when searching your accommodation that rent often specify the amount of service charges to pay.

What should I do if my lessor asks me to pay unplanned charges?

When moving in your first apartment, you don’t always expect to be charged of service charges, and you don’t necessarily understand what they cover. Yet your landlord is in right to ask you to pay for a number of service charges, even though you don’t feel like they’re yours to pay. It is what it is!

Recoverable charges should be clearly listed in the lease agreement. Your landlord also has to clarify their payment terms: does he establish a provision for charges or do you repay him once he’s paid charges?

If you agree on a provision for charges, your landlord will have to repay you once a year of the difference between what he paid and what you paid each month. Except if the provision for charges that you pay is lower than what he paid, in which case you’re the one who has to pay the complement.
 

When your landlord asks you to pay charges, he has to justify their nature, their use and be transparent regarding the amount that was asked from him. Every year, the co-owned property management readjusts service charges according to the actual expenses dedicated to maintenance that were made over the year. At that moment, a statement of charges is sent to you and the lessor usually sends you detailed justification of service charges at that same moment. But you may ask him for a summary of charges at any other moment to get a clearer pictures.

Do you feel like things aren’t that clear with your landlord around service charges? That he asks you to pay excessive amounts in the name of charges, or he asks you to pay for unexpected things? The first thing to do is to double check if the nature of the charge he asks from you is actually recoverable. Refer to the list of recoverable charges. He shouldn’t ask you to pay charges that aren’t part of that list. If he does, you can simply refuse to pay them.

Communication is key: If you realized required charges were wrongful after paying them, try reaching out on the phone or with an email to explain your doubts. If it doesn’t help, you can send him a formal notice in which you ask that he pays you back the due amount. You can also do that if your landlord is reluctant to sending you supporting documents regarding charges: by doing that, he keeps you from double checking if the charges you pay are fair or not. In most cases, a formal notice will do the trick! 

What happens if I use more water or electricity than planned? 

Like explained above, you owe your landlord money in this case. You will have to pay him back, except if you went for the forfeit option for service charges in your lease agreement. If you subscribed to an electricity and water contract yourself, you’re responsible for paying those bills: you’ll owe money to your energy provider and not to the landlord.

What happens if I use less water or electricity than planned?

Your landlord owes you money and has to pay you back, except once again if you pay your charges with a fixed fee.

If you’re the one managing your energy or water supply contract, your landlord doesn’t owe you anything. Depending on the plan you subscribed to, your bills might adapt to your consumption.

How long does the landlord have to pay me the difference back?

Your landlord has 3 years to pay you back the gap between what you’ve paid and what was actually due as regard to service charges.