What money must the managing agent hand over when an RTM company takes over?

Under section 94 of the Commonhold and Leasehold Reform Act 2002, the outgoing landlord or managing agent must pay the RTM company the accrued uncommitted service charges held on the acquisition date, including the reserve fund. It is a statutory duty and does not require a request from the RTM company.

Can an RTM company chase service charge arrears from before it took over?

No. Only actual money held is transferred, not the right to collect unpaid sums. An RTM company has no entitlement to pursue service charge arrears that predate its acquisition date. That right remains with the former landlord.

Can an RTM company demand service charge for a period a leaseholder has already paid?

It should not. Some leaseholders will have paid the previous agent in advance for a period falling after the acquisition date. That money forms part of the uncommitted service charge handed over under section 94, so demanding it again would charge the leaseholder twice for the same period.

How long does an RTM company have to demand service charge costs?

Under section 20B of the Landlord and Tenant Act 1985, costs must be demanded within 18 months of being incurred, unless the leaseholder is notified in writing within that period that the costs have been incurred and a contribution will be required.

For resident-led buildings · RMC & RTM

You took the right to manage. Take the books too.

Your acquisition date is coming. Openhold runs your building’s money from day one, and the records belong to your company, not to whoever operates them.

One email, when it’s ready. Nothing else. We store your address and country, and nothing more: privacy notice.

The agent is leaving. Where is your money?

On the day you take over, the law moves a specific amount of money, and pointedly does not move some other things. Most new RTM directors find this out the hard way.

s.94	The outgoing landlord or agent must pay you the accrued uncommitted service charges, including the reserve fund. It is a statutory duty, not a favour, and it does not need a request. Some will still stall, or ask you to pay to release the accounts.
Arrears	What does not come across is the debt. You cannot chase arrears that predate your takeover. That right stays with the old landlord, who now has little reason to use it. Your ledgers open clean, and possibly short.
The trap	Some leaseholders will already have paid the old agent for the period you are about to demand. That money should reach you in the handover. Demand it again and you begin your tenure with a dispute you cannot win.

s.94

The outgoing landlord or agent must pay you the accrued uncommitted service charges, including the reserve fund. It is a statutory duty, not a favour, and it does not need a request. Some will still stall, or ask you to pay to release the accounts.

Arrears

What does not come across is the debt. You cannot chase arrears that predate your takeover. That right stays with the old landlord, who now has little reason to use it. Your ledgers open clean, and possibly short.

The trap

Some leaseholders will already have paid the old agent for the period you are about to demand. That money should reach you in the handover. Demand it again and you begin your tenure with a dispute you cannot win.

This is the moment Openhold is built for. Import the opening position, mark what is bank-verified and what is only asserted, and demand cleanly from day one.

A money engine, not a filing cabinet.

Most tools for resident-led buildings store documents and track issues. Openhold runs the money: it raises the demands, matches the payments, and shows every leaseholder exactly where their contribution went.

One Demand

Apportion the budget across every flat from the lease, and issue demands that stand up. You approve; we send.

Two Reconcile

Match every payment against the bank statement. What is paid, what is owed, and what actually landed: three different questions, all answered.

Three Account for it

Every pound out is itemised, categorised and tied to its invoice. Leaseholders see the total and the receipt behind it.

Self-manage, or appoint an agent onto it. Most RTM companies take on an agent, and that is fine. Openhold sits underneath either way: your agent operates the block, and the books still belong to your company. Sack them, and nothing leaves with them.

The small print that quietly costs blocks real money.

Overnight, your company assumed every duty the landlord had. Service charge law is unforgiving, and most of it stays invisible until it bites. Four things that decide whether you get paid, keep your money, or land your directors in trouble.

s.20B	Costs must be demanded within 18 months of being incurred. Reissue a defective demand and you can restart that clock, and lose the money for good. Cure the defect instead, and the original date stands. Openhold cures. It does not reissue.
s.47	You will be told your demand must carry the landlord’s name and address. If your service charge is payable to your management company, it may not apply to you at all. It depends on your lease. Openhold reads which.
s.20	Consultation is triggered at £250 per leaseholder, measured against your largest contributor, not the average. Miss it and you recover £250 of a £40,000 roof. We hold the apportionment, so we can tell you the day you cross it.
s.116	A member asks to see the register of members. You have five working days to comply or apply to court. Do neither and it is a criminal offence, committed by the company and by every director personally. Most blocks have no idea.

s.20B

Costs must be demanded within 18 months of being incurred. Reissue a defective demand and you can restart that clock, and lose the money for good. Cure the defect instead, and the original date stands. Openhold cures. It does not reissue.

s.47

You will be told your demand must carry the landlord’s name and address. If your service charge is payable to your management company, it may not apply to you at all. It depends on your lease. Openhold reads which.

s.20

Consultation is triggered at £250 per leaseholder, measured against your largest contributor, not the average. Miss it and you recover £250 of a £40,000 roof. We hold the apportionment, so we can tell you the day you cross it.

s.116

A member asks to see the register of members. You have five working days to comply or apply to court. Do neither and it is a criminal offence, committed by the company and by every director personally. Most blocks have no idea.

None of this is advice, and we never certify anything. It is simply the law your money runs on, and we would rather the engine knew it than leave you to remember it.

Still deciding whether to take the right to manage?

What you qualify for, what changed in March 2025, what it really costs, and what you are actually signing up for. Free, no sign-up, and we do not do the legal work.

Thinking about Right to Manage? An honest guide for leaseholders, including what happens to the money on day one. Read the guide →

Own your building’s books.

Openhold opens to its first buildings in 2026. If your RTM company is forming, or your acquisition date is close, leave your email and we will tell you when.

One email, when it’s ready. Nothing else. We store your address and country, and nothing more: privacy notice.

Already a residents’ management company? Same problem, minus the handover. Openhold is for you too. We are starting with RTM companies because their need is sharpest, but the engine is the same.

You took the right to manage. Take the books too.

The agent is leaving. Where is your money?

A money engine, not a filing cabinet.

The small print that quietly costs blocks real money.

Still deciding whether to take the right to manage?

Own your building’s books.

You took the right to manage. Take the books too.

Why Openhold is different

The agent is leaving. Where is your money?

A money engine, not a filing cabinet.

The small print that quietly costs blocks real money.

Still deciding whether to take the right to manage?

Own your building’s books.