Schedule 8: Remediation costs under qualifying leases Paragraph 6: the permitted maximum Effect
Paragraph 6 makes provision about the meaning of "the permitted maximum" in relation to a qualifying lease.
	Sub-paragraph (2) sets out that the value of the permitted maximum is £15,000 for properties in Greater London, or £10,000 otherwise, for properties in the rest of England. Greater London means the 32 London Boroughs, the City of London, and the Temples (Inner and Middle Temple – which are treated separately as local authorities for most legal purposes), as set out in the London Government Act 1963. Sub-paragraph (2) is subject to sub-paragraphs (3) to (5).
	Sub-paragraphs (3) and (4) provide for a higher permitted maximum for higher-value properties. Where the value of the qualifying lease at the qualifying time (to which see section 119) is between £1,000,000 and £2,000,000, the permitted maximum is £50,000. Where the qualifying lease value is greater than £2,000,000, the permitted maximum is £100,000.
	Sub-paragraph (5) provides that where a lease is a shared ownership lease, the permitted maximum is to be calculated in accordance with the tenant’s total share of the lease at the qualifying time. This means that paragraph 6 applies according to the share of ownership in the property on 14 February 2022; the position does not change should a shared owner acquire an increased total share of their property after that date. Sub-paragraph (5)(a) sets out that the value of the qualifying lease is to be determined according to the value of a 100% share in the lease. Sub-paragraph (8) sets out the meaning of "shared ownership lease" and "total share".
	Sub-paragraphs (6) and (7) make provision for how the value of the qualifying lease at the qualifying time is to be determined. Sub-paragraph (6) sets out that the way in which the value of the qualifying lease is to be determined will be set out in regulations made by the Secretary of State. Sub-paragraph (7) sets out further detail about what the regulations may provide. These sub-paragraphs apply for the purposes of this paragraph and to paragraph 4 (which makes provision for service charges not to be payable if the lease value is below £175,000, or £325,000 for properties in Greater London).
	Sub-paragraph (7) sets out how the value of the qualifying lease is to be determined. If the property was last sold on the open market in 2022, the value of the lease is the value at which the property sold on the open market. If the property was last sold on the open market before 2022, then the value of the lease is determined by uprating the most recent sale price of the property in accordance with the regulations. The regulations may also set out how the value of the qualifying lease is to be determined in "prescribed cases", such as where the most recent sale price of the property cannot be determined.