# How much does the right to manage cost?

> Claiming the right to manage costs no purchase price or compensation, and since 3 March 2025 the RTM company is generally not liable for the landlord's costs of the claim. The unavoidable costs are small: a Companies House fee to form the company, Land Registry documents and postage. The bigger costs are optional professional help with the claim and, after takeover, the normal costs of running the building, which the service charge pays for.

**Key facts**

- No price or compensation is paid to the landlord for the right to manage.
- Since 3 March 2025, the RTM company is generally not liable for the landlord's costs (s.87A).
- A tribunal can only order costs against the company if the claim ends and the company acted unreasonably (s.87B).
- The company pays the reasonable cost of the landlord answering a request for information (s.82).
- Running costs after takeover (insurance, accounts, repairs) come from the service charge, as before.

## What you don't pay

- **No price for the right.** Unlike buying the freehold, the right to manage doesn't involve paying the landlord anything for the right itself.
- **Usually, no landlord's costs.** Before 3 March 2025, an RTM company had to pay the landlord's reasonable costs of dealing with the claim. Since then, the general rule is that the RTM company and its members are **not liable** for costs other people incur because of the claim notice (s.87A). Lease terms that say otherwise have no effect.

The exceptions are narrow:

- the reasonable cost of the landlord **providing information** you ask for under s.82;
- costs a court or tribunal orders in proceedings, where it has a separate power to do so (for example, for unreasonable conduct in the proceedings);
- the landlord's other reasonable costs, but only if the claim is withdrawn or fails **and** a tribunal decides the company acted unreasonably in making it or not withdrawing it sooner (s.87B).

## What you do pay to claim

| Cost                             | Roughly                                     | Notes                                                                             |
| -------------------------------- | ------------------------------------------- | --------------------------------------------------------------------------------- |
| Forming the RTM company          | A Companies House fee                       | See the current fee on GOV.UK                                                     |
| Title registers and lease copies | A few pounds per document                   | From HM Land Registry, to identify every leaseholder and the landlord             |
| Post and proof of delivery       | Tens of pounds                              | Use a method that gives proof, and keep certificates of posting                   |
| Directors' identity verification | Usually free through GOV.UK One Login       | Paid options exist through authorised agents                                      |
| Professional help (optional)     | From a few hundred pounds to a few thousand | A claim service or solicitor; more if the landlord disputes the claim at tribunal |
| Tribunal fees (only if disputed) | Fees set by the tribunal                    | Paid by the RTM company if it applies                                             |

Many groups fund this with an equal contribution from each participating flat.

## What it costs to run the building afterwards

After the [acquisition date](https://runyourblock.co.uk/glossary/acquisition-date), the building's costs are the same kinds of costs as before, paid through the [service charge](https://runyourblock.co.uk/glossary/service-charge):

- buildings insurance, and directors' and officers' insurance for the volunteers;
- repairs, maintenance, cleaning and communal electricity;
- fire risk assessment and safety checks;
- an accountant for the service-charge accounts;
- Companies House filing fees;
- a managing agent's fee, if you appoint one, or software and your own time if you self-manage.

Self-managing is often cheaper than paying an agent, but it isn't free: the directors' time is the biggest cost. See [Managing agent or self-manage?](https://runyourblock.co.uk/guides/running-your-block/managing-agent-or-self-manage).

## A worked example

At the fictional Maple Court (8 flats), the five participating leaseholders put in £60 each. That covers the company formation fee, title registers for all eight flats and the freehold, and posting the notices with certificates of posting. They use the prescribed forms themselves and don't use a solicitor. The landlord admits the claim, so there are no tribunal costs.

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This is general information, not legal advice. Every building and lease is different. For free initial advice, contact LEASE (The Leasehold Advisory Service): <https://www.lease-advice.org/>

## Frequently asked questions

### Do we still have to pay the freeholder's legal costs for a right to manage claim?

Generally not, for claims under the rules in force since 3 March 2025. The RTM company is only liable for the reasonable cost of the landlord providing information you request, any costs a tribunal orders in proceedings under its normal powers, and the landlord's other costs if the claim ends and a tribunal finds the company acted unreasonably.

### Can we use the service charge to pay for the claim?

Not before the takeover. Until the acquisition date, the service charge belongs to the landlord's management. The members usually fund the claim themselves, often by an agreed contribution per flat.

### Are 'free right to manage' offers really free?

Some managing agents offer to run the claim at no charge in return for being appointed to manage the building afterwards. Read the terms: check the length of the management contract, its fees and how you can end it.

## Sources

- [Commonhold and Leasehold Reform Act 2002, s.87A (costs: general)](https://www.legislation.gov.uk/ukpga/2002/15/section/87A)
- [Commonhold and Leasehold Reform Act 2002, s.87B (costs where claim ceases)](https://www.legislation.gov.uk/ukpga/2002/15/section/87B)
- [Commonhold and Leasehold Reform Act 2002, s.82 (right to obtain information)](https://www.legislation.gov.uk/ukpga/2002/15/section/82)
- [Leasehold and Freehold Reform Act 2024, s.50 (right to manage: costs)](https://www.legislation.gov.uk/ukpga/2024/22/section/50)
- [GOV.UK: Companies House fees](https://www.gov.uk/government/publications/companies-house-fees/companies-house-fees)
- [GOV.UK: Get information about property and land (HM Land Registry)](https://www.gov.uk/get-information-about-property-and-land)

## Related guides

- [How to claim the right to manage, step by step](https://runyourblock.co.uk/guides/right-to-manage/how-to-claim-right-to-manage)
- [How long does the right to manage take?](https://runyourblock.co.uk/guides/right-to-manage/right-to-manage-timeline)
- [Managing agent or self-manage? When to hire help](https://runyourblock.co.uk/guides/running-your-block/managing-agent-or-self-manage)
- [How to set a service charge budget for your block](https://runyourblock.co.uk/guides/running-your-block/budgets-and-service-charges)

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Last reviewed 22 October 2026 by Phil, founder. This is general information, not legal advice. For free, independent advice on leasehold law, contact LEASE: https://www.lease-advice.org/

Source: https://runyourblock.co.uk/guides/right-to-manage/right-to-manage-costs