It depends on whether the company has any income or transactions of its own — once you set aside the service charge money collected from leaseholders.
Service charge money collected from flat owners is usually held on trust under the Landlord and Tenant Act 1987. It is not the company's own income and should not be entered as turnover on the company's accounts or CT600. The service charge account is prepared separately for the leaseholders; the company's statutory accounts only report what genuinely belongs to the company itself.
Once you strip out the trust money, many residents management companies have very little — sometimes nothing — of their own to report. If that is the case, the company can file as **Dormant**. This is normal and accepted for flat management companies.
However, the company is **not dormant** if it has income or transactions of its own, for example:
- It receives ground rent (ground rent is the company's own income, not trust money)
- It earns bank interest on an account in the company's name
- It has management fees or other transactions that do not pass through the service charge trust
If any of those apply, file as a **Trading Company** and enter only the company's own income and costs — never the trust service charge money.
For a full walkthrough of both routes, see our guide: Filing Accounts for Flat Management and Freehold Companies — https://tinytax.co.uk/support/flat-management-freehold-companies
If you are not sure whether particular items count as the company's own activity, it is worth checking with your accountant — TinyTax supports either route.
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Service charge money collected from flat owners is usually held on trust under the Landlord and Tenant Act 1987. It is not the company's own income and should not be entered as turnover on the company's accounts or CT600. The service charge account is prepared separately for the leaseholders; the company's statutory accounts only report what genuinely belongs to the company itself.
Once you strip out the trust money, many residents management companies have very little — sometimes nothing — of their own to report. If that is the case, the company can file as **Dormant**. This is normal and accepted for flat management companies.
However, the company is **not dormant** if it has income or transactions of its own, for example:
- It receives ground rent (ground rent is the company's own income, not trust money)
- It earns bank interest on an account in the company's name
- It has management fees or other transactions that do not pass through the service charge trust
If any of those apply, file as a **Trading Company** and enter only the company's own income and costs — never the trust service charge money.
For a full walkthrough of both routes, see our guide: Filing Accounts for Flat Management and Freehold Companies — https://tinytax.co.uk/support/flat-management-freehold-companies
If you are not sure whether particular items count as the company's own activity, it is worth checking with your accountant — TinyTax supports either route.