What are body corporate levies?

Each year, a body corporate agrees its annual budget to cover its expenses and sets levies that lot owners must pay to meet those expenses.

In general, a body corporate must agree on a budget for an administrative fund and for a sinking fund – money cannot be moved from one fund to the other.

The administrative fund covers any expense that is not allocated to the sinking fund, such as regular maintenance of the common property, insurance fees and administrative expenses.

The sinking fund covers large or one-off expenses, such as painting or structural repairs to common property, replacing major items of common property, or other items that should reasonably be met from capital, such as pool furniture.

Money from both the administrative fund and the sinking fund that are not immediately needed can be invested, in the same manner a trustee can invest funds.

What happens if I don’t pay my body corporate levies?

In Queensland, a body corporate is obliged by law to recover unpaid contributions. A body corporate or a lot owner can apply to the office of the Commissioner for Body Corporate and Community Management for conciliation to try and reach an agreed outcome of a debt dispute.

A lot owner who is unfinancial cannot vote on most body corporate resolutions or nominate for the committee.

Further reading

• Can a body corporate recover unpaid levies?
• Committees need to manage funds for the long-term
• Body corporates must secure agreement before extra costs
• How are body corporate levies calculated?