RESERVE FUNDS held by Managing Agents on behalf of Home Owners

Cyllid a Thollau Ei Mawrhydi Nid oedd gan y wybodaeth y gofynnwyd amdani.

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?

Yours faithfully,

Rob Heale on behalf of FOI Central Team, Cyllid a Thollau Ei Mawrhydi

Our ref: FOI2017/02532

Dear Rob Heale,

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HMRC Freedom of Information Act Team on behalf of FOI Central Team, Cyllid a Thollau Ei Mawrhydi

1 Atodiad

Dear Rob Heale,

I am writing in response to your request for information, received 29th

Yours sincerely,

HMRC Freedom of Information Team