Our client is a limited company with flats on a long lease from a parent company, which are then rented out to individual tenants on a short lease terms.
Do we need to set up a new building management company to manage service charges? Could that be done using the subsidiary company with a dedicated bank account for any receipts from tenants and any payments made with regards to service charges, with a reporting in Xero being set up in a way to produce the annual service charge statements issued to tenants? Tenants themselves do not require anything but we want to ensure the company complies with any legal requirements.
Any comments or thoughts would be appreciated.