Your service charge is client money: it belongs to the building, not the managing agent. With us it is held on trust in a client bank account in your building's own name, reconciled every month, and protected by the RICS Client Money Protection Scheme, which pays valid claims if a member firm cannot repay client money.
A one-page note for directors, v1, 2026-09-18. The principles are the profession's and will not change.
One account per building. Your service charge and reserve fund are paid into a client bank account opened in the name of your building, at a UK bank, held on trust for the leaseholders. It is not our money, it is not mixed with our money, and it is not mixed with any other building's money.
Interest. Interest earned on the account belongs to the building and is credited to the building.
Who can move it. Payments out are made by us under the agreement, against invoices or the budget the board has approved. Two people see every payment run. The board can ask for a bank statement at any time and gets one with every quarterly report.
Reconciled monthly. The account is reconciled to the ledger every month, and the reconciliation is kept. If a payment cannot be matched it is chased until it is, not written off.
If we go. On termination the balance is transferred to the incoming agent or the company within the period the profession's code sets, with closing accounts drawn to the handover date and reconciled to the bank.
Protection. We are regulated by RICS (firm number 932779) and a member of the RICS Client Money Protection Scheme. If a member firm cannot repay client money, the scheme pays valid claims, up to £50,000 a claim and within annual limits set by RICS. Our certificate runs from 9 October 2026 to 9 October 2027. See the certificate. The scheme's terms and exclusions are at rics.org/clientmoneyprotectionscheme.
Never by email alone. We will never tell you or a resident about a change of bank details by email alone. Anyone who receives such a message should telephone the named manager before paying anything.
Questions
What is client money protection?
Insurance-backed cover, through a scheme such as the RICS Client Money Protection Scheme, that repays clients if a regulated firm fails to account for client money it holds.
How should a managing agent hold service charge money?
In a designated client account, separate from the agent's own money, held on trust for the leaseholders, with interest credited to the building and regular reconciliation. You are entitled to see the statements.
Is Essex Block Management client money protected?
Yes. We are regulated by RICS (firm number 932779) and members of the RICS Client Money Protection Scheme.
01Related
Block management in Essex, the handover checklist, the three letters, how we hold your money, the first ninety days. The free switching pack for Essex directors is at essexblockmanagement.co.uk. For a written quotation, the form takes two minutes.