General Conditions of Management for Residential Properties Excluding Assured Shorthold Tenancies
Mayfield Investment Trust Ltd
Our charges for Collection and Management are as follows:
| Ground Rents: | 18% inclusive of VAT on the gross rental. |
| Monthly Rents: | 18% inclusive of VAT on the gross rental. |
| Weekly Rents: | 18% inclusive of VAT on the gross rental. |
The above charges cover the following services:
- Collection of rent and/or any other items to be collected.
- General supervision of tenancies.
- Payment of outgoings i.e. water rates, insurance, repairs etc.
- Employ builders to carry out repairs for which the Client is responsible up to a cost of £100.00 inclusive of VAT. We can only give instructions without referring to owner for such items as we consider to be essential and/or required under the Health Act Regulations.
- Keeping of accounts and submission of a statement quarterly.
Payment of all outgoings is of course, subject to the owner’s account being in credit.
EXTRA FEES PAYABLE
In managing residential property, other services are likely to arise for which fees are charged as follows:
| SERVICE | FEES |
|---|---|
| 1. MAINTENANCE | |
| Repairs, carpet cleaning, general cleaning and other such items costing over £100.00 inclusive of VAT. This will include obtaining competitive estimates where necessary and supervising the works. | 15% of cost of works inclusive of VAT. |
| 2. RENT REVIEW | |
| a) Regulated Tenancies | |
| Application for registration of a fair rent to the Rent office – including service of Notice of Increase on tenants. | 6% of rent registered inclusive of VAT. |
| Attendance at consultation before Rent officer. | Minimum fee of £300.00 inclusive of VAT. |
| Appealing to the Rent Assessment Committee against registration of a Fair rent | On quantum meruit basis – minimum fee £720.00 plus fee for attendance at hearing if required inclusive of VAT. |
| Attending hearing to give evidence | £210.00 per hour including travelling time inclusive of VAT. |
| b) Assured Tenancies | |
| Considering open market rental value and serving Notice of Increase on tenant in respect of Assured tenancies. | 3.6% of rent proposed inclusive of VAT. |
| Dealing with appeals by tenant to Rent Assessment Committee against open market rent. Preparing representations and submitting them to Committee. | Quantum meruit basis-minimum fee £720.00 plus fee for attendance at hearing if required |
| Attendance at hearing to give evidence. | £210.00 per hour including travelling time inclusive of VAT. |
| 3. PROCEEDINGS | |
| Instructing Solicitors to issue proceedings for arrears of rent, possession etc. including attendance at Courts and other tribunals. | Quantum meruit – minimum fee £720.00 inclusive of VAT. |
| 4. TAX | |
| Preparation of statements for assessment of income tax. | Quantum meruit basis minimum fee £450.00 per year of assessment inclusive of VAT. |
| 5. TERMINATION OF MANAGEMENT | |
| £405.00 per tenancy where three months’ notice not given inclusive of VAT. |
REPAIRS
We need to be able to carry out day-to-day repairs to your property without reference to you. Unless you advise us to the contrary we will carry out repairs costing up to £600.00 inclusive of VAT without reference. Where we consider it appropriate, competitive estimates will be obtained.
REFURBISHMENTS
Where we undertake refurbishment of properties on behalf of Clients prior to re-letting or sale we will charge fees on the net cost of the works of 15% inclusive of VAT.
In addition, in order to comply with legislation produced by the Health & Safety Executive, documentation needs to be produced in order to comply with the Construction (Design & Management) Regulations 2015. We will arrange for an appropriate contractor to undertake the CDM. Their charges will be passed on to you. Our fees for the administration will be charged at £96.00 inclusive of VAT.
In order to comply with Health & Safety Legislation an Asbestos Survey of the property to be refurbished has to be undertaken by suitably qualified inspector who surveys the property, taking samples, if necessary, for analysis and reporting back on his findings and method of disposal of asbestos items found. We will instruct an appropriate person to undertake this survey on your behalf. Our fees for organising this will be £90.00 inclusive of VAT. The asbestos survey will cost between £420 – £540 inclusive of VAT plus the cost of any laboratory analysis tests.
ABORTIVE FEES
Once estimates for the refurbishment have been submitted to you, if you then decide not to proceed in accordance with the estimates, we will charge abortive fees of 90% of the fees chargeable based on the estimates inclusive of VAT.
GAS APPLIANCES
Where a residential tenanted property has gas installed there is a legal requirement on landlords to have a gas safety check untaken at least once in every twelve month period and any gas appliances belonging to the landlord must be included in the gas safety check and serviced.
We will arrange for our nominated CORGI registered contractors to undertake gas safety check and issue certification and where appropriate for landlords appliances such as boilers, water heaters, gas fires to be placed on a maintenance contract with them.
We have negotiated charges for this with our nominated CORGI registered contractors substantially less than charges raised by British Gas and the contractors charges for these services will be debited automatically from the rent account.
Our charges for the administration, organisation and recording the Gas Safety Certificates is £96.00 inclusive of VAT per tenancy.
On granting of a new tenancy of a property an up to date Gas Safety Certificate must be produced to the tenant and therefore in these circumstances more than one gas safety check may be undertaken in any twelve month period resulting in additional costs being raised.
ELECTRICAL APPLIANCES
Landlords must ensure that all electrical appliances and the electrical supply is safe. From 1st January 1997 all new appliances must carry a “CE” mark and all newly installed plugs and sockets must comply with regulations.
All new tenancies starting from the 1st July 2020 require a 5 year electrical test certificate. From the 1st April 2021 all existing tenancies require the same. We will arrange for our nominated electricians to undertake these tests on your behalf. Our administration fees for organising and recording the tests will be £96.00 inclusive of VAT.
ENERGY PERFORMANCE CERTIFICATES
Under Government legislation, all lettings or re-lettings after the 1st October 2008 must be supported by an Energy Performance Certificate a copy of which we must give to the tenant prior to completion of the letting. If you do not already have an Energy Performance Certificate for the property that we are to manage we will employ a company to produce the Certificate. At present, we are using a person called Barry Rolfe and his charges are £50.00 (no VAT). The Energy Performance Certificate is valid for ten years from the date of issue.
Our charges for the administration, organisation and recording of Energy Performance Certificates is £96.00 inclusive of VAT per tenancy.
OVERSEAS CLIENTS
Under the provisions of the Finance Acts, with effect from the 6th April 1996, unless and until specific action is taken by landlords and agreed by the Financial Intermediaries and Claims Office of the Inland Revenue, we will be obliged to submit a return and pay tax at currently at 20% on the net assessable rental income to the Inland Revenue within 30 days of the end of each three month quarter. The quarter dates are the last day of June, September, December and March, which coincide approximately with our quarterly dates. This will happen unless we receive notification from the Inland Revenue that we do not have to make a tax deduction from your income. In order to obtain this clearance, you have to take the following action.
In order to obtain the Inland Revenue’s agreement that you can receive income from property without deduction of tax, you must complete form NRL1 and send it to the Inland Revenue Financial Intermediaries and Claims Office at Bootle, whose address is shown on the back page of the form. If you wish we can supply you with a photocopy of Inland Revenue leaflet number 1R140 relating to the obligation of non-resident landlords, their agents and tenants, which may help you to understand the situation.
If you intend to apply to receive rental income with no tax deducted, it would be appreciated if you could let us have a copy of your application form for our records and we can also then chase up the appropriate department, if they have not responded by the time we deal with the first quarter’s rents.
TERMINATION OF MANAGEMENT
One quarter’s notice of termination on either side is required except in the case where we sell the property on behalf of the owner. Where the property is sold to the tenant originally introduced by this firm, the vendor will be liable for our commission of 1.8% of the sale price inclusive of VAT.
INSURANCE
Unless otherwise agreed, it will be a condition of our management that the insurance of the property and the contents, if appropriate, is through St. Giles Finance & Insurance Services Ltd., St Giles are our nominated insurance brokers, including full property owner’s liability to include Public Occupiers Liability. These brokers pay us a fee for reviewing the terms of the insurance on an annual basis, checking the renewal papers, organising and collecting the premiums on their behalf and accounting to them and overseeing any claims with the loss adjustors. The fee that we are paid for the work we do on insurance is retained by us in order to keep our costs down. However, under FSA rules and the RICS Designated Professional Body Scheme we are required to advise you on an annual basis of any money earned by general insurance mediation activity in relation to your property which we will of course do.
INTEREST
In order to keep our charges down to a minimum we keep a substantial amount of Clients money on deposit without obligation to pay any interest earned to clients. Under the RICS regulations, if Clients money is placed on deposit, strictly speaking, any interest earned belongs to the clients unless an individual agrees to waive the right to interest. The money is on immediate call if required.
In the past all our clients have agreed to waive the right to interest on any clients money on deposit with a view to keeping their costs down and we trust that you will continue to agree to this. If you do not, this will involve us in additional administration work and as a result we will have to increase our commission on collection by 6% over and above the figures mentioned above inclusive of VAT.
BANKING
All rents and other monies collected are banked at Nat West Bank PLC, 128 Balham High Road, London, SW12 9AE in the name of John G Dean Ltd Clients Account.
MONEY LAUNDERING REGULATIONS 1993 AS UPDATED
Under the above Legislation, we are required to obtain proof of identity without which we are regrettably not permitted to commence any work for you.
In the case of an individual or individuals who own the property, please provide us with a photocopy of each persons passport. If you do not have a passport, please supply a copy of driving licence or similar document which bears your name and signature, together with a current bill showing your name and address issued by a third party.
In the case of a company, please supply a copy of certified Certificate of Incorporation.
COMPLAINTS HANDLING PROCEDURE
As required by the RICS we have a formal complaints handling procedure, details of which will be provided upon request.
PROVISION OF SERVICE REGULATIONS 2009
We comply with the above regulation by displaying the required details of our Professional Indemnity Insurance in each of our offices.