Service charge vs ground rent (UK): quick difference for leasehold homes
Service charges pay for building costs. Ground rent is a separate leasehold charge. Here’s the quick difference with a tiny example.
Published: 16/04/2026 • Last verified: 16/04/2026
The short answer
Service charges usually cover the costs of maintaining, insuring, and managing the building (and any shared areas/services). Ground rent is a separate leasehold charge payable under the lease.
They’re different line items, they can change for different reasons, and you normally find the details in your lease and the service charge budget/statement.
A tiny example
Example (illustrative annual costs):
- Service charge: £1,200 per year (for building insurance, cleaning, maintenance, management)
- Ground rent: £150 per year (a leasehold charge payable to the freeholder)
If you’re budgeting monthly, that’s roughly £112.50 per month before you include rent (on the unsold share), mortgage, and other bills.
Helpful links
- Related calculator: /shared-ownership/
- Full guide: /guides/shared-ownership-service-charges-uk/
- Full guide: /guides/staircasing-costs-explained-uk/
- Glossary: /glossary/service-charge/
- Glossary: /glossary/ground-rent/
Sources