Leasehold Flat After Death: Service Charges and Transferring the Lease

Leasehold flats add an extra layer of complexity to estate administration. Unlike freehold property, there is a landlord involved — the freeholder or their managing agent — and ongoing financial obligations that do not pause simply because the leaseholder has died. Executors need to act promptly to notify the right parties and ensure the estate is not left liable for avoidable charges.

Service Charges and Ground Rent During Estate Administration

Service charges are payments made by leaseholders to the freeholder or managing agent to cover the costs of maintaining and managing the building — cleaning, insurance, repairs, lifts, and so on. Ground rent is a separate payment to the freeholder for the use of the land (though ground rent on new leases was abolished from June 2022 under the Leasehold Reform (Ground Rent) Act 2022, older leases may still carry a ground rent obligation).

Both service charges and ground rent (where applicable) continue to accrue during estate administration, regardless of whether the flat is occupied. The estate — not the beneficiary personally — is liable for these costs. The executor is responsible for ensuring they are paid from the estate's funds.

Failure to pay service charges can result in the managing agent taking legal action, and in extreme cases (though rare) forfeiture of the lease itself. Executors should check the lease and any managing agent correspondence to establish what is due and when.

How to Notify the Freeholder or Managing Agent

As soon as possible after the death, the executor should write to the freeholder or managing agent to notify them. The lease will usually specify the address for service of notices. Typical requirements are:

• A formal letter confirming the date of death
• A certified copy of the death certificate (the freeholder is entitled to see original or certified copy, not merely a photocopy)
• Confirmation of who the executor is (a copy of the Grant of Probate once obtained, or a copy of the will if probate has not yet been granted)
• Details of the executor's contact address for correspondence

The managing agent will then update their records and direct correspondence to the executor. This is also the moment to ask for a statement of account showing any service charge arrears or credits, and the next service charge demand date.

Transferring the Lease: Assent vs. Transfer Deed

Once the estate is ready to be distributed, the leasehold flat needs to be formally transferred. There are two main methods, depending on whether the flat is being passed to a beneficiary or sold:

Assent: This is used when the flat is being transferred to a beneficiary under the will or intestacy rules — for example, passing a flat to the deceased's child. An Assent is a document signed by the executor(s) confirming that the property is being assented to the named beneficiary. It must be registered at HM Land Registry. The beneficiary does not pay any consideration (purchase price), so no Stamp Duty Land Tax is usually payable.

Transfer deed (TR1): This is used when the flat is being sold on the open market or to a known purchaser. A solicitor will prepare the transfer deed as part of the conveyancing process. Stamp Duty Land Tax may be payable by the buyer depending on the purchase price and their circumstances.

In both cases, the executor acts as the seller or assenting party and signs the relevant documents. It is advisable to use a solicitor for leasehold property transfers, as there are additional steps compared with freehold — including serving the Notice of Assignment on the freeholder after completion.

Lease Extension Rights During Estate Administration

Under the Leasehold Reform, Housing and Urban Development Act 1993, a leaseholder who has owned their flat for at least two years has the statutory right to extend their lease by 90 years at zero ground rent. This right passes to the executor after death.

In most cases, executors can serve a statutory notice to extend the lease on behalf of the estate, even though the deceased has died. This can be important if the lease has fewer than 80 years remaining, as a shorter lease significantly affects the flat's value and mortgage prospects.

If the two-year ownership requirement was not met at the date of death, the executor can wait until the beneficiary has held the flat for two years after the Assent and then serve the notice in their own right. However, in practice, beneficiaries often prefer to negotiate informally with the freeholder rather than use the statutory route, which involves a valuation process and potentially costly tribunal proceedings.

Lease extension is a specialist area — seek advice from a solicitor experienced in leasehold enfranchisement before serving any notice.

Empty Property Insurance for Leasehold Flats

Standard home insurance policies contain clauses that typically void or significantly restrict cover if the property is left empty for more than 30 to 60 consecutive days, depending on the insurer. A flat being administered as part of an estate is almost always considered unoccupied for insurance purposes once the deceased has died.

The executor should take the following steps:

• Contact the existing home insurer immediately and notify them of the death and the property's unoccupied status
• Ask whether the existing policy provides cover for unoccupied property and for how long
• If the existing policy does not provide adequate cover, arrange specialist unoccupied or executors' property insurance

Note that the building insurance for a leasehold flat is usually arranged by the freeholder or managing agent as part of the service charge. This insurance covers the building structure. The leaseholder's own insurance covers their contents and liability. Confirm with the managing agent that the building insurance remains in force and will respond appropriately if the flat is unoccupied.