The Section 20 process, in plain English

Who this is for. Leaseholders who have had a notice through the door and want to know what it means. RTM and resident management company directors who have to run the process. Managing agents who want a page to send to both. We are a decorating contractor, not a solicitor. This guide describes the rules as they stand in September 2026 and links to the legislation; for a decision on your own block, take advice.

Section 20 of the Landlord and Tenant Act 1985 limits what a landlord can recover through the service charge for qualifying works. The limit applies unless the leaseholders have been consulted, or a tribunal has dispensed with consultation. The detail of how to consult is set out in the Service Charges (Consultation Requirements) (England) Regulations 2003.

Two triggers, and either one is enough.

• Qualifying works. Any works on the building or anything the landlord must maintain under the lease, where any one leaseholder's share of the cost would be more than £250. That threshold is the figure in force as at September 2026. Not the total bill: one leaseholder's share. On a block of 20 flats with equal shares, a £5,001 job triggers it.
• Qualifying long-term agreements. A contract for more than 12 months, such as a maintenance or cleaning agreement, where any leaseholder's share would be more than £100 in a year, again the figure in force as at September 2026.

These figures have remained unchanged since 2003. The government consulted in 2025 on raising them and standardising statutory notices, deferring its decision on major works thresholds in July 2026 to a subsequent response. Until revised regulations are enacted, £250 and £100 remain the statutory thresholds.

Most block redecoration and repair falls here. These are works where the contract does not have to go out to public tender under the procurement rules.

Stage one: the notice of intention. The landlord writes to every leaseholder and to any recognised tenants' association. The notice describes the works in general terms and says why they are needed. It invites written observations, and it invites leaseholders to nominate a contractor from whom the landlord should try to get an estimate. The notice says where the description can be inspected if it is not enclosed. Leaseholders have 30 days from the date of the notice to respond.

Stage two: estimates. The landlord must get estimates for the works. At least one must come from a contractor wholly unconnected with the landlord. If a leaseholder or the association nominated someone, the landlord must try to get an estimate from that person. Where several people were nominated, it is the one nominated most often, or one of those tied. The duty is to try to obtain the estimate, not to appoint the nominee.

Stage three: the notice of estimates. The landlord sends a statement setting out at least two estimates. It carries a summary of the observations received at stage one and the landlord's response to them. All the estimates are made available for inspection, and observations are invited for a further 30 days.

Stage four: the decision, and the notice of reasons. The landlord must have regard to observations received in time. Suppose the contract then goes to someone who was not nominated and did not give the lowest estimate. The landlord must write to leaseholders within 21 days of entering the contract, giving reasons, and again summarise and respond to the observations. If the nominee or the lowest estimate wins, no notice of reasons is needed.

Two 30-day windows, one 21-day one. The dates run from the date of each notice, so the notices should be dated and kept.

The landlord can recover no more than £250 per leaseholder for the works, whatever the works cost, or £100 a year for a long-term agreement. The only way round the cap is dispensation from the First-tier Tribunal under section 20ZA. The tribunal can dispense where it is satisfied that it is reasonable to do so. The leading case is Daejan Investments v Benson (Supreme Court, 2013). The question is whether leaseholders were prejudiced by the failure, not how serious the breach looked. Dispensation can come with conditions, such as a reduction in the sum or the landlord paying the leaseholders' costs.

For a leaseholder, that means a defective consultation is worth raising, in writing, at the time. For a landlord or an RTM company, it means the process is worth running properly the first time.

Leaseholders often do not realise that stage one invites them to nominate. If you have a contractor you trust, or one who has worked on a neighbouring block, nominate them in your written response. The landlord must then try to obtain their estimate. That estimate then sits in the notice of estimates beside the others, priced against the same specification. A nomination is not an appointment. The landlord chooses, and if the choice is not the nominee or the lowest, the notice of reasons explains why.

When a managing agent or an RTM company invites SFS to tender for Section 20 works, we return pricing broken down line by line against each clause in the specification. Consolidated items are clearly identified so surveyors and leaseholders can compare tenders on a true like-for-like basis. We hold CHAS Elite, carrying SSIP and the Common Assessment Standard, backed by £5,000,000 public liability and £10,000,000 employers' liability cover. We are SSIP assessed for both Contractor and Principal Contractor scope under CDM 2015, giving clients single-point accountability for site safety, programming and quality delivery. Site-specific RAMS and resident liaison letters are issued by our operations director prior to mobilisation, supported by weekly photographic progress updates throughout the contract. Further details of our block redecoration service appear on our managing agents and Section 20 page.

The Leasehold and Freehold Reform Act 2024 did not alter Section 20 procedures. Its service charge reforms (including standardisation of demands, mandatory annual reports and enhanced information rights) have received Royal Assent but remain subject to phased commencement during 2027. Any revision to consultation thresholds or notice formats will depend on subsequent regulations. We monitor statutory developments and update this guidance as changes take effect.

Section 20 applies when any leaseholder's share of works would exceed the qualifying threshold, £250 as at September 2026. The landlord serves a notice of intention (30 days, nominations invited) and obtains estimates, including from any nominee. It serves a notice of estimates (30 days) and has regard to observations. If the contract goes to someone who was neither nominated nor cheapest, it gives reasons within 21 days. Miss it, and the landlord recovers no more than the threshold figure from each leaseholder unless the tribunal dispenses.