Year-one building safety cost catch-up

Most ongoing BSA compliance costs are recoverable through service charges provided they have been reasonably incurred (Landlord and Tenant Act 1985 s.18). Part 5 of the Building Safety Act 2022 contains leaseholder protections that restrict charges for historical building safety defects. Ongoing compliance costs (BSR fees, FRA reviews, quarterly door checks, PEEPs, software) are generally recoverable; remediation of pre-existing defects may not be. Where any one leaseholder's contribution to qualifying works would exceed £250, the Section 20 consultation procedure applies. Section 20B of the Landlord and Tenant Act 1985 caps recovery of costs incurred more than 18 months before the demand was served on the leaseholder, unless a written notification was served within the 18-month window. For the procedural side, read the companion magnet section-20-essentials.

The government Impact Assessment for the Building Safety Bill estimated ongoing compliance costs at £9 to £26 per leaseholder per month, with a central estimate of £16. The IA is the government's published baseline. Sector commentary has called the figure an understatement of the year-one cost shape because the IA averages a recurring monthly figure across a heterogeneous building stock and omits the one-off year-one lines (registration, BAC application, initial Safety Case authoring). Ringley's published analysis is the most legible critique cited in the host post. The IA is a central estimate, not a cap, and it has limits an RTM director should know going in.

Section 20B(2) of the Landlord and Tenant Act 1985 preserves the recoverability of a cost where the leaseholder was notified in writing within 18 months of the cost being incurred. The notification is the carve-out: serve it within the window if the cost is already on the books. If the 18-month window has closed without a notification, the cost is barred from recovery under s.20B(1) and the line item moves to a future service charge year. Section 20B has no dispensation mechanism equivalent to s.20ZA. For the catch-up procedure in depth, read the companion magnet section-20-essentials.

No. The Building Safety Levy launches on 1 October 2026 and applies to developers of new residential buildings in England, not to existing building managers. It is charged per square metre of floorspace at rates set by local authority area, weighted by average house prices. Brownfield sites receive a 50 per cent discount. The Levy does not appear in an existing RTM's service charge budget.

The £159 per hour rate under the 2026-27 BSR charging scheme applies to Building Safety Regulator assessment time: Safety Case Report review, Building Assessment Certificate review, and other regulatory activities the BSR carries out on the building. A straightforward BAC assessment typically takes 10 to 15 hours of BSR time, which lands the year-one BSR cost in the £1,000 to £5,000 range per building when added to the £264 registration fee and the £302 BAC application fee. Complex buildings with extensive safety cases or gaps in documentation will use more BSR hours, so the headline application fee underforecasts the total BSR cost in those cases.