If you own a unit, townhouse, or apartment within a body corporate scheme, you’ll be required to pay owner contributions, more commonly known as body corporate levies.
These contributions fund the ongoing operation, maintenance, and long-term care of the scheme’s common property. Understanding how they’re set, calculated, and enforced can help you plan ahead and avoid surprises.
This article applies to schemes registered under the Standard, Accommodation, Small Schemes, and Commercial Modules. (Different rules apply to specified two-lot schemes.)
What Are Owner Contributions?
Owner contributions are payments made by each lot owner to cover shared body corporate expenses. These expenses typically include:
- Day-to-day administration costs
- Cleaning, gardening, and maintenance of common property
- Building insurance
- Long-term repair and replacement costs (via the sinking fund)
Each year, the body corporate prepares budgets and then levies owners their share to meet those costs.
How Are Levies Decided?
Levies are set at the Annual General Meeting (AGM). At this meeting, the body corporate must, by ordinary resolution:
- Approve the administrative fund and sinking fund budgets
- Calculate how much each lot owner must contribute
- Decide how many installments the levies will be paid in
- Set the due dates for each installment
Once approved, these levies become payable by all owners.
Special Contributions: When Extra Funds Are Needed
Sometimes unexpected expenses arise during the financial year — or costs end up being higher than budgeted.
In these cases, the body corporate may raise a special contribution (an additional levy) to cover the shortfall.
Example:
If common property painting costs exceed what was allowed for in the sinking fund, owners may be required to contribute extra funds to meet the difference.
A special contribution must also be approved by ordinary resolution.
Interim Contributions: Bridging the Gap
If there’s a temporary shortfall between financial years, the committee can set an interim contribution for either the administrative or sinking fund.
These interim levies:
- Are based on the previous year’s contributions
- Help cover expenses until new levies are set or received
- Must be offset against the next budget approved at a general meeting
How Levies Are Calculated
Levies are usually calculated based on each lot’s contribution schedule lot entitlements, which are recorded in the scheme’s Community Management Statement (CMS).
Important exception: Building insurance
For schemes with a building format plan, insurance costs are calculated using interest schedule lot entitlements, not contribution schedule entitlements.
Contribution Notices: What Owners Receive
The body corporate must issue a written contribution notice to each owner at least 30 days before payment is due.
The notice must include:
- The amount owing
- The due date
- Any applicable discounts
- Any late payment penalties
- Details of any overdue amounts
Discounts and Late Payment Penalties
To encourage timely payment, a body corporate may apply:
✅ Discounts
- Must be approved by ordinary resolution
- Can be up to 20% of the installment amount
- Only apply if payment is made by the due date
⚠️ Penalties
- Charged if payment is overdue
- Calculated as simple interest, capped at 2.5% per month
In special circumstances, the body corporate may choose to waive discounts or penalties, either partially or in full.
What Happens If Levies Aren’t Paid?
If contributions remain unpaid, the body corporate can begin debt recovery action.
- If a debt has been overdue for two years, recovery action must begin within two months
- Action can be taken earlier — the two-year mark is simply the latest point allowed
Debt Recovery Options
The body corporate can recover unpaid levies through:
- The Queensland Civil and Administrative Tribunal (QCAT) (as a minor civil dispute), or
- The courts
The body corporate may also recover reasonable recovery costs, including:
- Legal fees
- Body corporate manager fees for issuing arrears notices
Debt disputes cannot be decided by an adjudicator.
Can Levy Disputes Be Conciliated?
Yes — either the body corporate or an owner may apply for conciliation through the Office of the Commissioner for Body Corporate and Community Management.
However:
- Conciliation is not available if debt recovery has already started in QCAT or the courts
- If legal action begins after a conciliation application is lodged, the conciliation process must end
Final Thoughts
Owner contributions are a normal and essential part of owning property in a body corporate scheme. Knowing how levies are set, calculated, and enforced helps owners budget confidently and avoid disputes.
If you’re unsure about your levies or your responsibilities as an owner, seeking advice early can save stress (and money) down the track.