Last reviewed: August 2026. General guidance for England only. Wales, Scotland and Northern Ireland operate different rules. This is not legal advice, and you should take advice on your own leases before relying on it.
Most managing agents know Section 20 as the major works process: the letters that go out before a roof is replaced or a lift is modernised. Far fewer treat the maintenance contract itself as a consultation trigger, and that is where recovery quietly gets lost. A lift maintenance agreement that runs past twelve months is a qualifying long term agreement, and the threshold that pulls it inside Section 20 is £100 per leaseholder, not £250.
This guide sets out when consultation applies to a lift contract, what each notice stage actually requires, what it costs you to skip them, and how to plan a retender so the process does not leave the lift uncovered.
What is a qualifying long term agreement?
Section 20ZA(2) of the Landlord and Tenant Act 1985 defines a qualifying long term agreement as an agreement entered into by, or on behalf of, the landlord or a superior landlord for a term of more than twelve months. The definition turns on the length of the agreement, not on its value. Value comes in at the next stage.
Regulation 3 of the Service Charges (Consultation Requirements) (England) Regulations 2003 carves out a short list of exceptions, including contracts of employment, certain local authority management agreements, agreements between a holding company and its subsidiaries, and agreements entered into when the building had no tenants and running for five years or less. A lift maintenance contract between a landlord or residents management company and an independent lift contractor falls into none of them.
Two practical consequences follow. A twelve month contract is not a qualifying long term agreement, and neither is a twelve month contract that then continues month to month, though an arrangement that has plainly become long term in substance is judged on substance rather than on its label. Anything committed for thirteen months or more is caught.
Does a lift maintenance contract count as a QLTA?
Almost always, yes. Lift maintenance is exactly the sort of recurring service the regime was written for, sitting alongside cleaning, insurance and communal plant. Three year and five year lift terms are common precisely because contractors price them lower, and that longer term is what makes the agreement qualifying.
So the question worth asking is not whether your lift contract is a qualifying long term agreement. Assume it is. The question is whether the cost clears the threshold.
When does Section 20 consultation apply?
Regulation 4(1) of the 2003 Regulations applies section 20 to a qualifying long term agreement where the relevant costs incurred under it in any accounting period result in the relevant contribution of any tenant, for that period, being more than £100.
Read that closely. It is per leaseholder, per accounting period, and it is any one leaseholder, not the average across the block.
| Test | Threshold | Source |
|---|---|---|
| Term that makes an agreement qualifying | More than 12 months | s.20ZA(2), Landlord and Tenant Act 1985 |
| Qualifying long term agreement (the maintenance contract) | More than £100 per leaseholder per accounting period | Reg 4(1), SI 2003/1987 |
| Qualifying works (a repair or modernisation project) | More than £250 per leaseholder | Reg 6, SI 2003/1987 |
| Observation period on each notice | 30 days from the date of the notice | Reg 2(1), SI 2003/1987 |
A worked example. Take a block of 20 flats with two passenger lifts on a three year contract at £3,000 a year. Spread evenly, each leaseholder carries £150 for the period. That is over £100, so the agreement needs consultation. Halve the contract value and you are still over. In practice the threshold catches almost every block lift contract except a single lift shared across a large number of flats.
One refinement that catches people out: the arithmetic follows the apportionment set out in the leases, not a simple headcount. Where one flat carries a larger share, perhaps a penthouse or a commercial unit, that flat is the one that decides the question for the whole block.
If you want to sense check your own numbers, our lift maintenance cost guide sets out the typical market ranges by contract tier and lift type.
What are the consultation stages?
For a private block, where no public notice is required, Schedule 1 to the 2003 Regulations applies. There are two notices and two thirty day windows.
- Notice of intention. Written notice to every leaseholder and to any recognised tenants association, describing the services proposed, stating why the landlord proposes to enter into the agreement, and inviting written observations within 30 days. Leaseholders may also nominate a contractor for the landlord to approach.
- Have regard to the observations. The duty is to consider what comes back, not merely to receive it.
- Obtain estimates. The landlord must try to obtain an estimate from any contractor nominated by a leaseholder or by the association.
- Prepare proposals. At least two, and at least one must be from a person wholly unconnected with the landlord. Each proposal sets out the parties, any connection between them, the estimated leaseholder contribution or total cost where it is reasonably practicable to give one, and the intended duration of the agreement.
- Notify the proposals. Send them out, make them available for inspection, and invite written observations. Another 30 days.
- Respond. Within 21 days of entering into the agreement, give the reasons for the choice and respond to the observations received. This step falls away if the contractor chosen was nominated by a leaseholder or submitted the lowest estimate.
The two thirty day windows are the reason this needs planning rather than reacting. Add a tender period, the estimate stage and a board decision, and a properly consulted lift contract takes roughly three months from first notice to signature.
The two proposals rule deserves particular attention, because it is the one most often skipped. You cannot simply roll the contract over with the incumbent and call it consulted. You need a genuine second estimate from an unconnected contractor, which in practice means running a real tender. That is a useful discipline anyway: retendering is the single most reliable way to keep an incumbent honest on price and response times.
What happens if you skip consultation?
Section 20(1) limits what you can recover. Where consultation applied, was not carried out, and no dispensation has been granted, each leaseholder's contribution for that accounting period is capped at £100. The landlord remains bound to the contractor in full. The shortfall does not vanish, it simply cannot be passed through the service charge, so it lands on the landlord or on the reserve.
On the 20 flat example above, that is the difference between recovering £3,000 and recovering £2,000, repeated for every year the contract runs.
Section 20ZA(1) allows an application to the First-tier Tribunal to dispense with all or any of the consultation requirements, and the tribunal may grant it if satisfied that it is reasonable to do so. Daejan Investments Ltd v Benson [2013] UKSC 14 settled how that discretion works: the question is whether the leaseholders suffered real prejudice as a result of the failure, and the financial consequences for landlord or leaseholders are not themselves a relevant consideration. Dispensation is genuinely available and is often granted, frequently on terms such as the landlord meeting the leaseholders' costs. It is a remedy, not a plan.
Can you switch provider mid-term without a new consultation?
This is the question we field most often, usually from a manager whose current lift contractor has stopped turning up.
The short answer is no. If the existing agreement is a consulted qualifying long term agreement and you terminate it, the replacement is a new agreement. If that new agreement also runs beyond twelve months and clears the £100 threshold, it needs its own consultation. Consulting on the first contract buys you nothing on the second.
There are two legitimate ways around the timing problem:
- Take the incoming contractor on a term of twelve months or less. It is not a qualifying long term agreement, so no consultation is required, and it buys you time to consult properly on the longer term you actually want.
- Consult on the replacement while the existing contract runs out its notice. Most lift contracts need one to three months notice, which overlaps usefully with the two thirty day windows.
What you should not do is leave the lift without cover while you work it out. The maintenance duty under PUWER 1998 and the LOLER thorough examination cycle do not pause because a contract is being retendered. Our guide to switching lift maintenance provider covers the handover documents to demand and the notice traps to avoid.
How do you plan a lift contract around Section 20?
- Start about four months out. Two thirty day windows, a tender and a board decision do not compress well.
- Decide the term before you notify. A twelve month contract and a three year contract are different regulatory animals, and you cannot extend the term after consulting on a shorter one.
- Check the apportionment first. The threshold turns on the largest individual contribution, not the average, so work from the lease schedule rather than the flat count.
- Ask contractors to quote in a form you can put in front of leaseholders. One clear annual figure per lift consults far better than a low headline price with a page of variable extras.
- Keep the observations and your responses on file. That file is what wins a dispensation application if you ever need one.
- Keep the maintenance agreement and any modernisation works separate. Different tests, different thresholds. Running them together confuses both. For the works side, see our framework on repairing or replacing an ageing lift.
Frequently asked questions
Is a lift maintenance contract a qualifying long term agreement?
Usually yes. Section 20ZA(2) defines a qualifying long term agreement as one entered into by or on behalf of the landlord for a term of more than twelve months. A lift maintenance contract running for three or five years meets that definition, and none of the exceptions in regulation 3 of the 2003 Regulations applies to it.
Is the Section 20 threshold for lift maintenance £100 or £250?
£100. Regulation 4(1) applies section 20 to a qualifying long term agreement where the costs in any accounting period would make any one leaseholder's contribution more than £100. The £250 figure is the separate threshold for qualifying works under regulation 6. Mixing the two up is the most common error we see.
Does Section 20 apply to a twelve month lift contract?
Not on the strength of its term. A qualifying long term agreement must run for more than twelve months, so a twelve month contract falls outside the definition even if it is renewed each year. Qualifying works carried out during it can still trigger the separate £250 works threshold.
What happens if we did not consult on our lift contract?
Each leaseholder's contribution is capped at £100 for the accounting period, while the landlord stays liable to the contractor in full. You can apply to the First-tier Tribunal under section 20ZA(1) for dispensation, which may be granted if it is reasonable to do so, often on terms.
Are the Section 20 rules changing?
Reform is expected but is not yet in force. Part 4 of the Leasehold and Freehold Reform Act 2024 provides for changes to the service charge and consultation regime, the government consulted on the detail in July 2025, and secondary legislation is expected during 2026 with changes taking effect from 2027. Until then the 1985 Act and the 2003 Regulations described here continue to apply. We will update this page when the position changes.
Need a second estimate you can consult on?
Schedule 1 needs a proposal from a contractor wholly unconnected with the landlord. Send us the lift details and we will return a clear annual figure per lift, set out so it can go straight into a notice of proposals. No obligation and no sales chase.
