Faqs

Strata levies are struck initially by the developer and then annually at the AGM. They fall into two categories, namely levies that are collected for the Administrative Fund and Capital Works fund. These are calculated on what is known as a unit entitlement basis.  

Unit entitlements are calculated for individual lots in a scheme and they usually vary. You can establish your unit entitlement by searching the strata plan or the certificate of title of the common property of your scheme. 

The Administrative Fund is established for day-to-day expenses, and they include costs for maintaining the common property, payment of insurances premiums, electricity, water, gas, cleaning costs and garden maintenance. 

The Capital Works fund, which used to be referred to as the Sinking fund, is used capital expenses which include: 

– painting or repainting common property. 

– replacing or repairing the common property. 

– getting, renewing or replacing property of the owners corporation (for example, outdoor furniture, a table in the foyer). 

– renewing or replacing fixtures and fittings that are part of common property. 

– project management, supervision, or other related expenses for these works. 

If either the Capital Works or Administrative funds has insufficient funds, these may be raised by striking a special levy.  

To raise a special levy, the owners corporation must give all owners a written Notice of the proposed special levy and: 

– describe the proposed new service, shortfall, facility, upgrade, or improvement. 

– show the total amount proposed to be raised by the levy. 

– set out the amount or method of calculating the special levy needed from each owner.  

– state when the special levy will be due in one sum or by instalments. 

– explain how the owners can vote on the proposal. 

The Notice must be given to all owners. The special levy is approved if the majority of owners who are present and financial, vote in favour of the special levy. 

Once the special levy is paid, it can only be used the purpose it has been raised.