From 31 December 2025, the updated Service Charges in Commercial Property Professional Standard issued by Royal Institution of Chartered Surveyors (RICS) came into force.
While the principles of transparency, fairness and communication remain familiar, the revised Standard introduces more prescriptive and mandatory requirements that materially affect how service charges are budgeted, administered and recovered.
For landlords and asset managers, this is not simply a technical update. According to property asset management experts, Vail Williams LLP, it has direct implications for tenant relationships, lease compliance and, ultimately, income security.
What has changed with the RICS Service Charge Professional Standard?
The revised Professional Standard strengthens several areas that have historically been a source of tension between landlords and tenants. In particular, it introduces additional mandatory requirements around:
Budget and reconciliation time limits: Reinforcing the expectation that service charge budgets and end-of-year reconciliations are prepared and issued within defined timescales
It also includes additional provisions on:
- Forward funding: Including clearer provisions and templates to improve transparency where major works or future expenditure are anticipated.
- Environmental, Social and Governance (ESG) considerations: Reflecting the growing importance of sustainability, social value and governance in property management decisions.
- Dispute resolution: Clearer guidance on how disagreements between a landlord and a tenant should be managed and escalated
While the Standard applies directly to RICS-regulated firms, its influence extends well beyond RICS membership.
What do your leases say?
More commercial leases now include provisions requiring their landlords to follow or have regard to the RICS Professional Standard when administering service charges. In some cases, tenants are actively seeking to include clauses such as this during lease negotiations or at lease renewal.
This means that even where a landlord is not an RICS member, failure to comply with the Standard may expose them to challenge, including the risk that certain service charge costs become irrecoverable.
As market practice evolves, the Standard is becoming the benchmark against which service charge administration will be judged.
Why does compliance with the RICS Professional Standard matter?
The revised Professional Standard raises the bar when it comes to service charge management. Where landlords fail to follow its mandatory requirements, they may face:
- Increased service charge disputes
- Delays in recovery or non-recovery of costs
- Reputational risk with existing and prospective tenants
- Reduced confidence from investors and funders
From a reputational perspective, compliance provides a clear framework for managing expectations and demonstrating professionalism, whilst meeting with changing expectations from a tenant perspective.
