A condo special levy is an additional contribution that a management corporation may raise to cover an expense, often major or unexpected work that existing funds cannot cover. Ask for the resolution, written levy notice, lot calculation and due dates. These documents help distinguish a project under discussion from a contribution that has actually been levied.
If you are buying or selling, give the notice and payment history to your conveyancing lawyer before committing. Under section 40 of the Building (Strata Management) Act, an incoming owner can in specified circumstances be jointly and severally liable with the previous owner for an unpaid contribution and interest, subject to section 47(3). A private agreement about who should bear a cost needs to be considered separately from the management corporation’s statutory rights.
- Identify the work, resolution and written notice.
- Check the share value or other applicable basis for the amount charged.
- Separate the amount already due from later instalments and possible projects.
- Ask the conveyancing lawyer about the management corporation’s certificate and sale terms.
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Chapters 1–3
Separate routine fees from a special contribution
A condo’s routine contributions usually support a management fund and a sinking fund. The management fund covers ongoing costs. The sinking fund is used for longer-term capital needs within the statutory framework. A special contribution can arise when the estate needs to raise additional money for a major job or unexpected work. BCA gives lift modernisation as one example of work that should be planned for and may require additional funding if there is a shortfall.
Read the actual request. A managing agent’s circular may describe a proposal for roof repairs, outline possible costs or announce a meeting. A formal levy notice has a different purpose. Ask which stage has been reached and which document establishes what owners have to pay. A high estimate may never become the final contribution if the scope or funding changes.
Find the reason for the shortfall
Ask which project is involved and why the existing budget does not cover it. The reason could include urgent repairs, a larger work scope or several major jobs becoming due at once. Look for an explanation in the meeting paper and financial records. A contribution may be a sensible way to fund necessary work. The question for an owner is what work was authorised, how it will be paid for and what remains uncertain.
Check whether the quoted amount includes tax, professional fees, contingency and the work needed to reinstate shared areas. If the amount circulated to residents was only for the main works, ask what else is included in the approved funding. Read the budget and the notice together rather than comparing a single contractor quotation with the final amount collected.
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Distinguish an approval from a discussion
Request the agenda, motion and minutes. Read the wording that was passed and identify whether it approves a study, authorises a contract, sets a contribution or does more than one of these. Ask whether a later decision was made that changes the amounts or dates. A line in the minutes saying that the council will review options should not be treated as a demand for payment.
Section 40 describes levying contributions through written notice to owners. For an existing owner, check the lot number, amount and payment dates in the notice. Ask for clarification if the notice refers to a resolution that you cannot identify. Keep the original notice and any revised version so it is clear which schedule you are relying on.
Check how the instalments work
A levy may be collected in one payment or over several dates, depending on the decision and notice. Write each due date in your calendar. Confirm how payments are allocated and when they appear in the account statement. If two payments are due in the same month, check whether one is the ordinary maintenance contribution and one is the levy.
Suppose the estate approves a lift project at one meeting and later sends a notice requiring three payments. Use the notice to plan payment and read it alongside the meeting resolution to understand the purpose. If a meeting paper described a possible grant or contribution from another party, ask whether that funding has been confirmed. Check whether the approved amount was based on that assumption or on the full cost.
If you think a notice is incorrect, ask the managing agent to explain the amount and the relevant authority for it. Keep a record of the query and the dates. If the dispute is material, seek advice about the appropriate route and treatment of payment while it is being addressed.
| Record | What it answers | Check the date |
|---|---|---|
| Project paper or quotation | What work is being considered | When the estimate was prepared |
| General meeting resolution | What decision the owners made | Meeting date and wording |
| Written levy notice | What contribution was levied on the lot | Due dates and any instalments |
| Lot account statement | What has been billed or paid | Statement period |
| Section 47 certificate and completion statement | Information relevant to ownership transfer and settlement | Issue date and legal completion date |
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Verify the share value and the amount being raised
The Act generally allocates contributions proportionally to the share values of the lots, subject to applicable provisions and exceptions. Ask the managing agent what calculation applies in this case. Request the lot’s share value, the total used for the apportionment and the amount being raised under the relevant decision. Check whether the calculation covers the entire estate or some arrangement requiring a different analysis.
For illustration, if an estate raises $360,000 in proportion to a total share value of 1,200 and your lot has five share values, a simple proportion gives $1,500 for the lot. If the approved notice divides that amount into three equal instalments, each is $500. Actual amounts depend on the governing documents, applicable law and rounding. Use the example to check the arithmetic, then verify the actual notice.
Distinguish the contractor price from the funding shortfall
An approved project might cost $500,000 and the MCST might plan to meet part of the expense from available funds. If the amount to be raised separately is $360,000, use that figure for the levy calculation, subject to the confirmed decision. An owner who multiplies the entire project price by their share value may overestimate the contribution. Conversely, assuming all available cash can be used may understate what the estate needs to raise.
If a quote changed after tender, find out whether owners approved a revised scope or budget. Compare the total project cost, funds allocated and the separate amount raised. The numbers should be explained in a way that lets an owner follow the calculation without guessing about omitted expenses.
Check the share value calculation against the notice
Use the amount to be raised, the lot’s share value and the total share values relevant to the decision. Keep each number with its source. If the managing agent uses a figure that differs from the one in the papers you received, ask whether the calculation covers a different group of lots or uses another rule that applies to the project. Ask for the explanation in writing if the amount is material.
Consider two units with five and seven share values in the earlier example. On the stated assumptions, their estimated contributions would be $1,500 and $2,100. That difference follows from the different share values. It need not match a simple comparison by floor area. If the estate proposes the same dollar amount for each lot, ask what rule and resolution support that approach before assuming it should use the example formula.
Check for rounding and adjustments on the actual statement. The instalments should reconcile with the total levy after taking any clearly identified credits into account. If an amount appears twice, ask whether it is a repeat notice, a revised payment or an additional contribution. The due dates and reference numbers can help distinguish them.
An owner who plans to show the calculation to a buyer can prepare a short schedule with the lot number, notice date and payment dates. Keep receipts with the relevant line. If a payment is expected to appear later, give the buyer’s lawyer the receipt and ask the management corporation to confirm its treatment. A self-prepared calculation can explain the numbers, while the documents establish what was levied and paid.
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Keep regular charges and the levy separate
Set up two rows in the household budget. Keep the recurring maintenance charge in one and the dates and instalments for the additional levy in the other. If you rely on rental income, check when rent is due relative to the levy. A large payment can fall before the next receipt. Ask the managing agent about the payment methods and verify each payment against the account.
Section 40 contains rules on contributions becoming payable, interest on certain unpaid contributions and recovery. If you expect difficulty paying, contact management early to ask about the actual account and available arrangements. Keep any written response. Do not assume that a discussion suspends a due date or alters the formal levy.
Read the funding discussion for what it reveals
If an estate has several major projects in view, ask which ones are funded and which are still estimates. A special levy can cover one specific shortfall while later work still needs a separate decision. Look at the sinking fund plan, recent expenditure and the timing of upcoming maintenance. Record which figures are approved and which could change.
For a household deciding whether to remain in the property, compare the levy with the benefits and disruption of the works. Lift renewal or waterproofing may make day-to-day life better while requiring a substantial payment. Consider both sides in the budget. Avoid assuming that a lift project, for example, will eliminate every maintenance issue in the estate.
Follow up an expense that rises after approval
A contractor’s estimate can change after work begins. If management announces a higher cost, ask whether it is being absorbed within the approved funding or whether a further contribution is being considered. Ask for the updated project cost, the remaining contingency and the decision authorising any new amount. The estate’s cost increase and an individual owner’s payment obligation are different figures.
For example, a notice may say that additional repair was discovered once an area was opened. The managing agent can explain whether the scope is within the contract and whether additional money must be raised. If owners are asked to vote again, read the revised motion. Check whether the earlier levy stays in place, is being varied or has been accounted for in the new sum. Keep the two documents together so you can follow the change.
If you are selling during this period, inform the conveyancing lawyer and ask how a confirmed or proposed extra contribution should be addressed in the transaction. If you are buying, ask for current records before completion where the change is material. Use the amount and dates actually shown for the lot. Update the household budget when the decision and notice are confirmed.
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Give the lawyer all the relevant dates
Put the meeting date, date of written notice, each due date and the proposed completion date on one page. Ask for the lot’s account statement and tell the lawyer about instalments that run across completion. Give them the proposed sale terms and any correspondence about who is expected to pay. A broad statement that the seller covers maintenance may leave a question about a special contribution or an instalment due later.
Under section 40(3), if another person is liable for a contribution when you become the lot’s subsidiary proprietor, you may be jointly and severally liable for the contribution and interest, subject to section 47(3). In practical terms the management corporation’s right to recover a sum may differ from how buyer and seller allocate it between themselves. Ask the lawyer to explain both issues for your case.
Ask about the section 47 certificate
Section 47 provides for requests for information and a certificate relating to the lot. Ask your lawyer about obtaining and checking the applicable certificate and its effect. A dated certificate can be important for statutory liability, and the lawyer can advise on what the document says and what period it covers. Also ask for current account information and the resolution if the project may give rise to future payments.
Imagine the seller paid two instalments of a levy and a third is scheduled after legal completion. Ask the lawyer to check when the third instalment was levied, what remains payable and how the sale agreement deals with it. If the seller is to bear a cost, clarify how that is reflected in the settlement. Keep the latest certificate, notice and completion statement in the same file.
Read the certificate with its date visible
Section 47(3) describes the effect of a certificate under section 47(1)(c) for specified recipients. For someone acquiring a relevant interest for value, it is conclusive evidence of the matters stated in it as at its date. Ask the lawyer to check which matters the certificate actually addresses and whether any later change needs to be verified. Keep the date prominent. An accurate statement at its issue date can precede a later notice or a new instalment.
Imagine a certificate issued before a proposed roof project goes to a meeting. It may give the lawyer relevant information about amounts at that date. The buyer should still ask management about the project and ask for later records if the proposal is important. Now imagine that the project was approved and contributions were levied before the certificate date. The lawyer can compare the certificate, notice and payment history to check how the relevant amount is treated.
Avoid assuming that a balance of zero means there is no upcoming payment. Ask whether any instalment has been authorised but falls due after the statement period and whether an additional levy is being discussed. State what you are asking about rather than requesting only a generic statement that the account is clear. A clear answer can distinguish arrears, outstanding instalments and a future proposal.
If the agreed sale terms allocate a cost to the seller, ask how the lawyer will reflect that in the transaction and whether evidence of payment is needed at completion. If a cost remains uncertain, discuss the wording and timing with the lawyer before committing. Keep the relevant records together so they can see which amount you are referring to.
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Ask targeted questions about major work
Ask whether special contributions have been proposed, approved, levied or paid for the lot. Ask for the current amount, future instalments and any changes to the scope. A reply saying there are no arrears might mean the current owner has paid everything due. It does not answer whether a payment will become due later or whether owners will soon vote on a new project.
If a levy is material, include it in the total acquisition and running-cost comparison for the property. Separate confirmed sums from estimates. A cheaper sale price can leave the buyer with a higher immediate cash requirement if a contribution falls soon after purchase. Ask the lender and lawyer about the timing and funding using the actual documents.
Record the outcome after completion
Compare the first management statement received after completion with the final settlement. Ask which items relate to the previous owner, which apply after completion and whether credits are pending. Use the lot number and statement date when contacting management. Retain evidence of any payment made on your behalf and confirm what future dates remain.
If work is only proposed, keep the relevant minutes and request updates after the next meeting. A budget for ownership can carry an allowance for unresolved costs while keeping it separate from a confirmed payment. The aim is to be able to distinguish a general maintenance concern from an amount that must be paid by a specific date.
Compare two purchase budgets with different levy dates
Suppose one condo costs less to buy but has an approved instalment soon after completion. A second condo is more expensive but management confirms no comparable levy is currently payable. Put the agreed price, stamp duties, immediate repairs, and confirmed levy payments in separate columns. If the first home requires a larger cash payment in the first month, check that it fits the household’s available funds even if the overall purchase price is lower.
Make a separate note for work that is still being studied. A managing agent might say that the estate expects to replace its lifts in coming years, but there may be no confirmed funding decision. Record the timing, documents and possible scale as an uncertainty. Ask whether the sinking fund plan already includes the project. This gives the buyer a more accurate view than treating all future work as a confirmed levy or assuming it will cost nothing.
Think about the project’s effect on the home as well. If lifts will be taken out of service in phases, ask what access arrangements are expected and how they might affect a household member with mobility needs. If shared parking or another facility will close for a period, include that in the moving plan. These questions belong alongside the payment issue rather than in place of it.
Once completion is near, get the most recent relevant documents through the proper route. Confirm what has changed since the offer, what has been settled and what the buyer should put in the next budget. A documented answer about one levy does not establish the cost of every future project. Keep the next review date with the meeting records.
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Is a special levy the same as my usual maintenance fee?
It is an additional contribution. Check the decision and notice to see what expense it funds and how it is collected.
Does every lot pay the same amount?
Contributions are generally proportional to share value subject to applicable provisions. Check the actual calculation and notice.
Does the seller always pay if the meeting happened before completion?
The answer depends on statutory liability, the notice, the applicable certificate and the sale terms. Ask the conveyancing lawyer to check the documents and dates.
Can a buyer be liable for an unpaid contribution?
Section 40 can make the incoming owner jointly and severally liable with another liable person, subject to section 47(3).
What should I ask for first?
Obtain the resolution, levy notice, lot statement and payment schedule. Ask your lawyer about the section 47 certificate in a resale.
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