Quick Answers
Is an RTM company required to hold an AGM?
Most RTM company articles of association require an annual general meeting, even though the Companies Act 2006 does not mandate AGMs for private companies. Check your specific articles. Members representing 10% of voting rights can require directors to call a general meeting at any time regardless.
How much notice is required?
Minimum 14 clear days for a general meeting of a private company, or 21 clear days for an AGM. Clear days means neither the day of service nor the meeting day count. The notice must reach all members entitled to attend. Many RTM company articles set a longer minimum.
Who can attend and vote?
All leaseholders who have become members of the RTM company are entitled to attend and vote. The freeholder also has a right to be a member and attend. Leaseholders who have not joined the company as members can attend as observers in many cases but cannot vote.
The short answer: an RTM company is a registered company and its general meetings must comply with both its articles of association and the Companies Act 2006. The minimum notice period is 14 clear days for a general meeting (21 for an AGM where required). Resolutions must be proposed correctly. Quorum must be reached. Minutes must be taken and kept. Accounts must be presented. Directors whose terms have expired must be re-elected or replaced.
The most common failure: RTM directors who hold an informal gathering of a few leaseholders, discuss the block's management, and call it the AGM. This does not meet the statutory requirements. If a member later challenges a resolution passed at an invalid meeting, the resolution is void. If company accounts have never been properly approved, the company may be in breach of the Companies Act, which carries personal liability for directors.
Key Takeaways
The RTM company is a real company with real governance obligations
When leaseholders exercise their right to manage, they incorporate a company. That company is registered at Companies House, has directors, and has members. The directors are personally liable for ensuring the company meets its Companies Act obligations. "We are just a small block management company" is not a defence to non-compliance with statutory company law.
The AGM and the leaseholder meeting are different things
Many RTM directors conflate the annual leaseholder meeting about service charges and block management with the formal general meeting of the company. They are different. The service charge meeting is an informal update. The general meeting is a formal statutory process with notice requirements, quorum rules, and resolution procedures. Both are valuable. Neither substitutes for the other.
All qualifying leaseholders can become members — and should be invited to do so
The RTM company is required to admit qualifying leaseholders as members. A leaseholder who has not been invited to join the RTM company, or whose request to join was refused without good reason, has a right to apply to the Tribunal. RTM directors who restrict membership to the original exercise group are not operating the company correctly and are creating grounds for challenge.
Annual accounts must be filed at Companies House
Every RTM company must file annual accounts at Companies House. Small companies (which almost all RTM companies are) can file abbreviated accounts. The deadline is nine months after the company's financial year end. Failure to file on time generates automatic late filing penalties, and persistent failure to file is a criminal offence for directors. This is one of the most commonly missed obligations for RTM companies.
Director terms must be managed and re-elections held
The articles of association will specify director terms and when re-election is required. Where a director's term has expired and they have not been re-elected, they are not technically a director and any actions they take in that capacity may be challengeable. Most RTM companies do not track director terms and have directors who have never been formally re-elected after the initial exercise. This is a governance gap that needs to be addressed.
Minutes must be kept and retained for 10 years
Minutes of every general meeting must be kept and are available to members on request. The Companies Act requires meeting minutes to be retained for at least 10 years. An RTM company that has never kept formal minutes of its meetings has no documentary record of the decisions made in its name. This matters when a resolution is challenged, when a managing agent dispute arises, or when the company needs to demonstrate how a particular decision was made.
The RTM Company: What It Is and What It Owes
When leaseholders exercise the right to manage under the Commonhold and Leasehold Reform Act 2002, they do so through a company specially incorporated for the purpose. That company is typically a private company limited by guarantee, registered at Companies House, with the qualifying leaseholders as members and a subset of them as directors.
The RTM company takes over from the freeholder the management functions of the building. It appoints (or replaces) the managing agent, takes control of the service charge, and holds the obligations previously held by the freeholder or their managing agent under the leases.
What many RTM directors do not fully appreciate is that incorporating this company creates ongoing company law obligations that run in parallel with the block management obligations. The company must:
- File annual accounts at Companies House by the filing deadline
- File a confirmation statement (previously the annual return) each year
- Maintain a register of members (leaseholders who have joined the company)
- Maintain a register of directors
- Hold general meetings in accordance with the articles of association
- Pass resolutions in the proper form for decisions that require them
- Keep minutes of all general meetings
The most common compliance gap for RTM companies is failure to file annual accounts and confirmation statements at Companies House. Late filing generates automatic penalties starting at £150 and rising to £1,500 for delays of more than six months. Persistent failure to file can result in the company being struck off the register, which would extinguish the right to manage. Directors can be personally fined. Check your company's filing position at Companies House now if you are not certain it is up to date.
The Legal Requirements: A Clear Overview
| Requirement | What It Involves and the Consequence of Non-Compliance |
|---|---|
| Annual accounts | Accounts must be prepared for each financial year and filed at Companies House within nine months of the year end for a private company. Small RTM companies can file abbreviated accounts. Failure to file generates automatic penalties and risks the company being struck off. Directors are personally liable for filing obligations. |
| Confirmation statement | Filed at Companies House at least once every 12 months, confirming or updating key company information: registered office, directors, members, share capital (for limited companies). Failure to file is a criminal offence. RTM companies frequently miss this because it has no direct block management function and is easy to overlook. |
| General meetings | Whether an annual general meeting is required depends on the articles of association. Most RTM company articles require at least one annual meeting of members. Meetings must be called with proper notice (minimum 14 or 21 clear days), must reach quorum, and must be conducted in accordance with the articles. Resolutions must be proposed and voted on correctly. Minutes must be kept. |
| Member register | The company must maintain an accurate register of members, which records all qualifying leaseholders who have joined the company. When a flat is sold, the outgoing leaseholder leaves the register and the incoming leaseholder has the right to join. Failing to maintain an accurate register means the company does not know who is entitled to attend and vote at meetings. |
| Director obligations | Directors of RTM companies owe the same statutory duties as directors of any other company under the Companies Act 2006, including the duty to act within their powers, promote the success of the company, exercise reasonable care and skill, and avoid conflicts of interest. Personal liability for company law breaches falls on directors, not the company as a whole. |
| Meeting minutes | Minutes of every general meeting must be recorded and retained for at least 10 years. Members have a right to inspect the minutes book. Failure to keep minutes creates an evidential gap when decisions are challenged and is itself a Companies Act breach. |
Calling the Meeting Correctly
The process for calling a general meeting of an RTM company is more formal than most RTM directors assume. A WhatsApp message to the group chat, an email to the people who happen to be in the building, or a note left in the communal hallway does not constitute valid notice of a company general meeting.
Check the articles of association
Before doing anything else, read the company's articles. These set out whether an annual meeting is required, the minimum notice period (which may be longer than the statutory minimum of 14 or 21 clear days), the quorum requirement, how notice must be served on members, and what constitutes a valid resolution. If the company has never located its articles, they will be on file at Companies House or with the solicitor who handled the right to manage exercise.
Confirm the membership register is current
Notice must be sent to all members entitled to attend. If the membership register has not been updated since the right to manage exercise, it may contain names of leaseholders who have since sold their flats, and may be missing current leaseholders who have bought in more recently. Update the register before sending notice. Where an incoming leaseholder has not yet applied to join the company, give them the opportunity to do so before the meeting so they can participate.
Draft and send the formal notice
The notice must be in writing (email is valid where members have consented to electronic service or where the articles permit it). It must state: the date, time, and place of the meeting; the business to be transacted; the text of any resolutions to be proposed; the right of members to appoint proxies if the articles provide for it; and the deadline for proxy appointments. Send it to every member on the register and keep a record of service.
Prepare the supporting papers
Accounts to be approved at the meeting should be circulated with the notice or made available to members in advance. Any director report or management accounts for the service charge year should also be prepared. Members who receive no papers before the meeting and are expected to approve accounts they have never seen are not being given a meaningful opportunity to participate in governance.
Confirm quorum before starting
Before opening the meeting, confirm that quorum is present. Count members present in person and any valid proxy appointments. If quorum is not reached within the waiting period specified in the articles (typically 15 or 30 minutes), the meeting must be adjourned and re-called. Do not proceed to pass resolutions without quorum: they will be void.
The Agenda: What Must Be Covered
A well-structured AGM agenda covers the mandatory company business first, then the block management business that members actually care about. Mixing them without structure leads to meetings where the service charge discussion runs for two hours and the director re-election gets nodded through in thirty seconds at the end.
RTM Company AGM Agenda
Running the Meeting Effectively
The procedural requirements are important, but the goal is a meeting that achieves something. An RTM company AGM that is technically valid but accomplishes nothing except confirming accounts and re-electing directors is a missed opportunity. Here is how to make it work.
Chair the meeting with structure
Appoint a chairperson and stick to the agenda. The biggest failure mode in RTM company meetings is leaseholders raising individual flat complaints and grievances under every agenda item. The managing agent update is the right place for those. The formal resolutions should be presented, voted on, and recorded quickly and clearly.
Circulate accounts and papers before the meeting
Members who receive accounts at the meeting and are expected to approve them five minutes later have not had a meaningful opportunity to review them. Send the accounts and any supporting papers at least seven days before the meeting. This reduces the meeting time spent on account queries and produces better-informed votes.
Record votes clearly in the minutes
For each resolution, the minutes must record: what was proposed, who proposed and seconded it, the outcome of the vote (for, against, abstentions), and whether it was carried or defeated. "The resolution was approved" is not sufficient. "Proposed by [name], seconded by [name]. Four votes for, zero against, one abstention. Carried." is the correct form.
Use the block management section productively
The operational section of the meeting is where directors should present: the reserve fund balance and the current saving rate, planned major works in the next 12 months, any Section 20 consultations anticipated, the service charge budget for the coming year, and any managing agent performance issues. This is the section where informed members make better governance decisions.
Take minutes contemporaneously
Appoint a minute-taker before the meeting starts. Minutes drafted from memory a week after the meeting are less reliable and harder to defend if challenged. The minute-taker should record attendance, quorum confirmation, each resolution proposed and its outcome, the main points of any discussion, and any actions agreed with named owners and deadlines.
Invite but do not require the managing agent
The managing agent is not a member of the RTM company and has no voting rights. Inviting them to attend the operational section of the meeting to answer questions is useful and encourages accountability. Having them attend the formal resolutions section is not necessary and can create an impression that the agent runs the meeting rather than the directors.
After the Meeting: The Follow-Through
The meeting is only as useful as the follow-through that comes after it. Three things must happen after every general meeting of an RTM company:
Minutes must be circulated and stored. Send the draft minutes to all members who attended within two weeks. Allow a reasonable period for corrections to be raised. Once confirmed (at the next meeting or by written agreement), sign and date the minutes. Store them in the company's records. Make them available to members who request to inspect them.
Resolutions must be filed at Companies House if they are special or written resolutions. Most ordinary resolutions passed at general meetings do not need to be filed, but special resolutions (requiring 75% majority) must be filed at Companies House within 15 days of being passed. Failure to file a special resolution is a criminal offence. Check whether any resolution passed at the meeting requires filing.
Actions agreed at the meeting must be tracked and reported on at the next meeting. If the meeting agreed that the managing agent would obtain three quotes for roof repairs by a specific date, that action should be on the agenda for the next meeting as a standing item. AGM resolutions that are never followed up create leaseholder frustration and undermine the RTM company's credibility.
If directors were appointed, re-elected, or resigned at the meeting, notify Companies House promptly using the relevant form. Director changes must be notified within 14 days. Failure to keep the Companies House register of directors current is a criminal offence and creates confusion about who is authorised to act on behalf of the company.
For the broader obligations of an RTM company in managing a residential block, see What Makes a Good Managing Agent? 10 Questions Every RTM Director Should Ask and Service Charges Explained: What Leaseholders Are Actually Paying For. For how major works decisions interact with the service charge, see Structural Repairs and Section 20.
Frequently Asked Questions
Most RTM company articles of association require an annual general meeting, even though the Companies Act 2006 does not mandate AGMs for private companies. Check your specific articles. Where the articles do require an annual meeting, failing to hold one is a breach of the articles and potentially of the directors' duties. Members representing at least 10% of voting rights can require directors to call a general meeting at any time regardless of whether an annual meeting is formally required.
All qualifying leaseholders who have become members of the RTM company are entitled to attend and vote. The freeholder also has a right to be a member and attend. Non-member leaseholders can often attend as observers but cannot vote unless they are members. The RTM company is required to admit qualifying leaseholders as members on application.
Quorum is defined in the RTM company's articles of association. Standard template articles for RTM companies typically require a minimum number of members present in person or by proxy, often two members or a percentage of total membership. A meeting without quorum cannot validly pass resolutions. If quorum is not reached within the waiting period specified in the articles, the meeting must be adjourned and re-called.
The Companies Act 2006 requires a minimum of 14 clear days' notice for a general meeting of a private company, or 21 clear days for an AGM (where required). Clear days means neither the day of service nor the day of the meeting counts. The RTM company's articles may require a longer period. Notice must be sent to all members entitled to receive it.
The specific resolutions depend on the articles and the company's circumstances. Typical mandatory business includes: approval of the directors' report and accounts; re-election of directors whose terms have expired; appointment of accountants if required. Special resolutions requiring a 75% majority are needed for changes to the articles, changes to the company name, or winding up. Most routine business is passed by ordinary resolution with a simple majority.
Managing an RTM company and not sure your governance is in order?
Neon helps RTM companies across East London and Essex run their governance correctly alongside their block management obligations. From Companies House filing to AGM preparation, minutes, and member register management, we cover the company law side so directors can focus on running the block well.
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