Retail surgery: We do not think we are getting value for money from the service charge we pay on some of our stores. How do we go about challenging the landlords on this?

Tenants should look closely at the terms of their leases, because mistakes in the way service charges are calculated are not rare, says Chris Renshaw, retail director at property consultancy CRC North.

“We have seen a number of instances where tenants have been wrongly charged or have overpaid, but simply didn’t know how to challenge the landlord or where to go for advice,” he says. “Most just assume charges are correct, but quite often they’re not.”

CRC North advises that tenants normally have an opportunity to demand further information on the costs, expenditure and calculations of their service charge. Challenging, testing and verifying the service charge should normally be done within a certain timescale, as laid down in the lease.

In particular, CRC North advises on a couple of issues retailers should look out for. The first is that a stamp of certification on a service charge from an accountant does not mean that it has been calculated correctly, but rather that the amounts charged have been spent.

The second is the amount tenants are charged for repairs. Commercial tenants are responsible for repairs but not inherent defects in most leases, so they should look out for charges for fixing defects or repairs that improve the building, rather than maintain it.

CRC North has produced a plain English guide to service charges that can be viewed on its website.