My leaseholders aren't paying ground rent: what can I do?

A calm, step-by-step look at recovering unpaid ground rent: serving a valid Section 166 demand, sending reminders, the six-year limit, and where the law on forfeiture actually stands.

Unpaid ground rent is usually less about a leaseholder refusing to pay and more about the demand never being made properly. The sums are small, often £6 to £50 a year, so they slip. The good news is that recovery is methodical: there is a clear order of steps, and most arrears are settled long before anything formal. The bad news is that the shortcuts people reach for (late fees, threatening forfeiture) are exactly the ones the law restricts.

Here is the sensible order, and where the legal limits sit.

Step 1: Make sure a valid demand was actually served

Before treating anyone as "not paying", confirm a valid Section 166 demand went out for the year in question. Ground rent on a long lease is not payable until that prescribed notice is served, with a payment date 30 to 60 days ahead. If the notice was missing, late, or wrongly completed, the leaseholder is not in arrears at all. They simply have nothing to pay yet. Serve a clean notice first. (See our guide on what a Section 166 demand must contain.)

Step 2: Send clear, dated reminders

Once a valid demand has passed its payment date unpaid, a polite reminder resolves most cases. Keep it factual: the property, the period, the amount, the original demand date, and how to pay. Send a second reminder if needed. Record every contact (dates and copies), because consistent records are what make any later step straightforward.

Step 3: Recover reasonable administration costs (if the lease allows)

For leasehold properties, Schedule 11 of the Commonhold and Leasehold Reform Act 2002 lets you recover reasonable administration charges (for example the cost of issuing reminders), provided the amount is reasonable and properly notified. It is not a licence to invent fees. There is no automatic right to add interest or a penalty unless the lease itself provides for it.

Step 4: Pursue it as a debt, if it comes to that

Validly demanded, unpaid ground rent is an ordinary debt. The proportionate route for small sums is the County Court small claims track. It is rarely worth issuing a claim for a single year's rent on its own, which is why freeholders usually let a property's arrears build to a sensible figure (while staying inside the six-year window) before acting, and recover the court fee as part of the claim.

Where forfeiture really stands

Forfeiture (ending the lease) is the remedy people reach for and almost never the right one for ground rent. The law deliberately makes it hard:

• A landlord cannot start forfeiture for unpaid rent, service charges or administration charges unless the sum owed is more than £350, or some part of it has been outstanding for more than three years.
• Even then, forfeiture is court-supervised, the leaseholder can usually obtain relief by paying, and it is wholly disproportionate to a small ground rent.

Treat forfeiture as a backstop that signals seriousness, not as a collection tool. For unpaid ground rent, the realistic remedy is the debt itself.

Don't let it pass six years

The single most important discipline is the six-year limitation period. Each year's rent must be recovered within six years of falling due, or it is generally statute-barred. Demand every year, keep records, and the arrears never become a problem you can't fix.

If arrears are approaching or beyond six years, take advice from a solicitor before acting. The Limitation Act 1980 can bar the older sums entirely, and whether time has run can turn on the specific dates and any payments or acknowledgements along the way. This is a point to have checked rather than judged by eye.

A note on scope: this is general information about administering ground-rent arrears, not legal advice. Where arrears are large, long-standing, or you are considering any court step, take advice from a solicitor first.