1. What is a Section 20B Notice?
   A Section 20B Notice is a formal notification sent to leaseholders and tenants when the final accounts for service charges are not available within 18 months of the costs being incurred. This notice informs you of the provisional costs related to your service charges and preserves the
   landlord’s right to recover these costs once the final figures are available
2. Why would I receive a Section 20B notice?
   You will receive a Section 20B notice if there has been a delay in finalising the service charge accounts for your property. The notice is issued to ensure that the landlord retains the legal right to recover any costs incurred during the relevant financial period, even though the final accounts have not yet been prepared.
3. What does this notice mean for me?
   This notice means that the costs mentioned are provisional and based on estimates. Once the final accounts are completed, you may be required to pay an adjusted amount.
4. What are provisional costs?
   Provisional costs are estimates of the service charges that are expected to be incurred based on the information currently available. These figures are provided as a ‘worst-case scenario’ and may be adjusted once the final accounts are prepared.
5. Is this a new charge?
   No. This is a service charge adjustment for the financial year ending 31 March.
6. Will I receive the final accounts?
   Yes, once the final accounts are prepared, you will receive a detailed breakdown of the service charges for the relevant financial period. This document will explain the actual costs incurred and any adjustments that need to be made to your account.
7. Could the final amount I need to pay be different?
   Yes, the final amount you may need to pay could be different from the provisional figures provided in this notice. The final service charge amount will be based on actual costs incurred and could be higher or lower than the provisional estimate.
8. What if I have already paid my service charges?
   If you have already paid your service charges, this notice serves to inform you that the final amount may differ from what was originally estimated. If the final accounts show that you have overpaid, you may be entitled to a refund. Conversely, if the final costs are higher, you may need to pay the difference.
9. When will the final accounts be available?
   The final accounts are currently being prepared and will be sent to you as soon as possible. We are working to ensure that the accounts are completed promptly and accurately.
10. When will this take effect?
    These charges will be included in your April rent and service charge notice.
11. What if I have concerns about the service charges?
    If you have concerns about the service charges, you can raise them with us. Once the final accounts are issued, you will have the opportunity to review the detailed breakdown of costs. If you believe the charges are unreasonable, you may have the right to challenge them through the First-tier Tribunal (Property Chamber)
12. I am in receipt of Housing Benefit/ Universal Credit. How will this affect me?
    Housing Benefit and Universal Credit will continue to cover eligible service charge underpayments. It’s important for tenants to report any underpayment adjustments promptly to avoid complications, and they may need to provide evidence to support their claim.
13. Will I receive another notice once the final accounts are ready?
    No, the final accounts will be provided to you directly without a further Section
    20B notice. However, the final service charge statement will include all relevant details, and you will be informed of any adjustments required.
14. What should I do with the notice? You should keep the notice for your records, as it relates to the service charges for your property. If you have any questions or concerns, please contact Gloucester City Homes for further clarification.
15. Why is the finalisation of the accounts delayed?
    The delay in finalising the accounts could be due to a variety of reasons, such as awaiting final invoices from contractors, reconciliation of accounts, or complexities in allocating costs fairly among leaseholders. Gloucester City Homes is working diligently to resolve these issues and complete the final accounts.
16. What is the purpose of issuing a Section 20B Notice?
    The purpose of issuing a Section 20B Notice is to comply with the legal requirement that service charges must be demanded within 18 months of the costs being incurred. By issuing this notice, Gloucester City Homes reserves the right to recover these costs once the final accounts are ready. Without this notice, Gloucester City Homes may lose the right to collect the service charges.
17. What should I do if I cannot afford to pay the adjusted service charges?
    If the final accounts result in an adjusted service charge that you are unable to pay, it’s important to contact Gloucester City Homes as soon as possible. We may be able to discuss payment plan options or offer advice on how to manage the costs.
18. Can I dispute the provisional figures provided in the notice?
    The figures provided in the Section 20B Notice are provisional estimates of expenditure and may not reflect the final costs. However, if you have concerns about the accuracy of these figures, you can raise them with us. Final disputes should be made once the actual costs are provided in the final accounts.
19. What happens if the final service charge is significantly higher than the provisional estimate?
    If the final service charge is significantly higher than the provisional estimate, you have the right to request a detailed explanation and breakdown of the costs. If you believe the charges are unreasonable, you may challenge them through the First tier Tribunal (Property Chamber).
20. How do I know that the final accounts will be accurate?
    The final accounts will be prepared based on the actual costs incurred for the services provided. These accounts will be reviewed and, where necessary, certified by independent accountants to ensure their accuracy and compliance with the terms of your lease.
21. What if I do not agree with the final service charge amount?
    If you do not agree with the final service charge amount, you can request further information or clarification from Gloucester City Homes. If you still believe the charges are incorrect or unreasonable, you have the right to challenge them through the First-tier Tribunal (Property Chamber).
22. Can I request to see the invoices and receipts for the service charges?
    Yes, you have the right to request and inspect the invoices, receipts, and other documentation that support the service charges. This can be done once the final accounts are issued, and it will help you verify the accuracy of the charges.
23. How will I be informed about the payment details once the final accounts are ready?
    Once the final accounts are ready, you will receive a detailed statement that
    includes the final service charge amount and payment instructions. This will include information on how to make payments, and deadlines.
24. What are my rights if I believe the service charges are unreasonable?
    If you believe the service charges are unreasonable, you have the right to challenge them through the First-tier Tribunal (Property Chamber). This tribunal can determine whether the charges are fair and reasonable based on the services provided and the costs incurred.
25. How can I contact Gloucester City Homes with further questions?
    You can contact us using the contact details provided in the Section 20B Notice. We should be able to assist with any further
    questions or concerns you may have regarding the notice or the service charges.
26. What if I’ve lost my 20B Notice?
    If you’ve lost your Section 20B Notice, there’s no need to worry. All the key information will be available on our website. Since this is a delay notice, you won’t need a replacement copy, and all the relevant details will be provided to you in due course.
27. What happens if I sell my property before the final accounts are issued?
    If you sell your property before the final accounts are issued, it is crucial that your solicitor informs the buyer’s solicitor about this Section 20B notice and the potential for service charge adjustments. Any underpayments or overpayments related to service charges stay with the
    property, not the seller. This means that the new owner will be responsible for any outstanding charges or will benefit from any refunds once the final accounts are issued. Due to this, the buyer’s solicitor may request a retention (a sum of money held back from the sale proceeds) until the final service charge accounts are settled. This retention protects the buyer against unforeseen liabilities.
28. What if I only pay service charges based on actual expenditure and not estimates?
    If your lease specifies that you only pay service charges based on actual expenditure, the Section 20B Notice still plays an important role. The notice is issued to inform you of the provisional costs incurred during the financial period. However, since you are billed based on actual costs rather than estimates, you will not be required to make any payments until the final accounts are prepared and the actual expenditure is determined.

Here’s how it works for Leaseholders:

• Provisional Costs: The Section 20B Notice will provide you with an estimate of the costs incurred. This is for your information and to ensure the landlord retains the right to recover these costs once the final accounts are ready.
• No Immediate Payment Required: Since you pay based on actual expenditure, you will not need to make any payments until the actual costs are confirmed and provided to you in the final accounts.
• Historical Invoicing Practice: Historically, Gloucester City Homes has invoiced leaseholders in arrears, meaning charges are recovered within 18 months after they have been incurred. This practice often results in payments being spread over the following months, typically through Direct Debit or other payment agreements.
• Final Accounts and Billing: Under this system, you will receive the final accounts detailing the actual expenditure, and only then will you be required to pay based on the true costs incurred. This ensures that your payments reflect the actual services provided. You will only be billed once the final accounts are prepared, detailing the actual costs incurred during the period. Your payment obligation will be based on this final, accurate figure.
• Future Changes: Gloucester City Homes is currently undertaking a project aimed at improving the service charge process. One of the goals is to align the timing of service charge invoicing more closely with when costs are incurred, rather than the current practice of billing in arrears. This will help reduce the delay between when services are provided and when they are paid for, although any changes will be carefully considered and communicated to you well in advance.