Yes I have done that on the socket in the hallway and it works fine.
But I need the phone and router connected to the lounge socket.
What could be the problem and will I get charged to fix it?
It sounds like the lounge socket isn't connected up. BT Can do it, but they'll charge £130 or so. An electrician/handyman would probably do an equally good job for much less.
But the broadband works from the lounge socket. Its very strange, I would have thought that if the phone won't work then neither will the broadband.
It sound like a bad installation, as your broadband would not normally work from an extension socked, one the new faceplate has been fitted.
This picture shows how it should be connected.