Leaseholder guide · Updated 18 June 2026
What is a Residents' Management Company (RMC)?
A Residents' Management Company (RMC) is a company set up so leaseholders can manage their building's communal areas, services and service charges. The RMC is usually named in the lease, and may own the freehold or hold a head lease - giving residents, through elected director-leaseholders, direct control over how the block is run.
RMC vs RTM company: what's the difference?
Both put residents in control, but they are created differently. An RMC is set up through the lease - often by the developer - whereas an RTM company is formed by leaseholders exercising a statutory right to take management away from the freeholder.
| RMC | RTM company | |
|---|---|---|
| How it is created | Set up by the developer, or named in the lease | Formed by leaseholders under the 2002 Act |
| Statutory right | No - it is contractual, through the lease | Yes - a statutory no-fault right |
| Owns the freehold? | Often yes, or holds a head lease | No - the freeholder keeps it |
| Who can be a member | Shareholders or members defined by the lease | Qualifying long leaseholders who opt in |
| Proof of fault | Not applicable | Not needed |
Who owns and runs an RMC?
Members own the company - commonly one share or one membership per flat, which transfers to the new owner when a flat is sold, so control stays with the current residents. The members elect directors, usually volunteer leaseholders, who make decisions and carry legal responsibility for the company. Directors can appoint a managing agent to handle day-to-day work while remaining accountable to the members.
What are an RMC director's responsibilities?
Being an RMC director means wearing two hats: company-law duties and property-management duties.
Run the company correctly
Directors owe the legal duties set out in the Companies Act 2006, and must file annual accounts and a confirmation statement at Companies House - even for a small, non-trading block.
Manage service charges lawfully
Set a realistic budget, demand service charges in line with the lease, hold the money in trust, and comply with the Landlord and Tenant Act 1985. Charges must be reasonable and properly accounted for.
Consult on major works
Where qualifying works will cost any leaseholder more than £250, or a long-term agreement more than £100 a year, the RMC must run a Section 20 consultation before committing.
Maintain the building and insurance
Keep the structure, common parts and grounds repaired, arrange buildings insurance, and meet building-safety obligations - appointing a managing agent or contractors where needed.
Keep members informed
Hold meetings, share accounts, and answer reasonable leaseholder requests. Members elect the directors and can replace them, so transparency keeps the company healthy.
For a deeper look, read our guide to RMC director responsibilities.
Residents' Management Companies: frequently asked questions
Run your RMC without the spreadsheets
Marklet gives RMC directors a shared workspace for issues, service charge oversight, Section 20 consultations, and a full audit trail. Free to start.
Further reading
- Residents' Management Companies explained
- RMC director responsibilities
- What is Right to Manage (RTM)?
This guide is general information, not legal advice. For free, official guidance see LEASE (the Leasehold Advisory Service). Always take specialist advice on your specific lease and company.