RESERVE FUNDS held by Managing Agents on behalf of Home Owners
Rob Heale made this Rhyddid Gwybodaeth request to Cyllid a Thollau Ei Mawrhydi
This request has been closed to new correspondence. Contact us if you think it should be reopened.
Dear HM Revenue and Customs,
Reserve Funds (or "Sinking Funds") are held by Managing Agents on behalf of Long-Leasehold Home Owners, mainly to pay for cyclical maintenance or Major Works. They are paid for, often with the Service Charges, by the Long-Leaseholders themselves. According to the relevant 1987 Act of Parliament, section 42, these Reserve Funds, that can reach large amounts, should be held in a Designated (Separate) Account at a Financial Institution. Please answer the following questions related to these Reserve Funds:-
1. How are these Reserve Funds (paid by Long-Leasehold Home Owners) accounted for in the Annual Company Accounts of Managing Agents and other Companies that might hold these?
2. Are Managing Agents entitled to include these Reserve Funds (that are supposed to be held separately in trust) as part of their own Company reserve Funds?
3. Are these Home Owners Reserve Funds accounted for separately?
4. If these Home Owners Reserve Funds are not accounted for separately, is there potential for Managing Agents to misuse these funds? What action is taken to prevent this?
5. What procedures are in place to ensure that the cumulative amounts paid by Flat Owners to a Managing Agents or other Property Management Company are not misused for a purpose that they were not intended for?
Our ref: FOI2017/02532
Dear Rob Heale,
Freedom of Information Act 2000 Acknowledgement
Thank you for your communication of 29th December which has been passed to
HMRC's Freedom of Information Team.
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HMRC Freedom of Information Act Team
Dear Rob Heale,
I am writing in response to your request for information, received 29th
HMRC Freedom of Information Team
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