levies
📖 What is levies? Meaning and definition
In New Zealand, for unit title properties, levies are financial contributions that individual unit owners are legally required to pay. These payments are determined by the body corporate, which is responsible for managing the common property and shared facilities of the unit title development. The purpose of levies is to fund the ongoing maintenance, repairs, insurance, and administrative costs of the entire property, ensuring that all shared aspects are well-managed.
Levies are typically calculated based on each unit owner's utility interest, meaning their share of the overall property. The body corporate sets the due dates for these payments. If a unit owner fails to pay their levies by the due date, interest can be charged on the unpaid balance, often at a rate specified by the body corporate, up to a maximum of 10% per annum, as outlined in the Unit Titles Act 2010.
Disputes can arise regarding how levies are determined or whether they have been paid. The Tenancy Tribunal can hear applications for the recovery of unpaid levies, interest, and associated costs, such as debt collection costs and legal fees. The Tribunal will assess whether the levies were properly determined and if the unit owner is liable for the claimed amounts, including any accrued interest and costs incurred by the body corporate in pursuing the debt.
📋 Requirements
- The unit owner must pay all body corporate levies and outgoings for their unit.
- Levies must be determined by the body corporate.
- The unit owner's share of levies is calculated according to their utility interest.
- The body corporate must fix a due date for the levies to be paid.
- Interest may accrue on unpaid levies if not paid by the due date, up to 10% per annum.
📝 Procedure
- The body corporate determines the levies payable and calculates each unit owner's share.
- The body corporate fixes the due date for payment of the levies.
- If a unit owner does not pay by the due date, interest may be charged on the unpaid balance.
- The body corporate may apply to the Tenancy Tribunal for recovery of unpaid levies, interest, and associated costs.
- The Tenancy Tribunal considers the application, including evidence of the amount claimed and whether the levies were properly raised.
💡 Examples
- A unit owner was ordered to pay annual levies, roofing levies, debt collection costs, legal fees, and interest totalling over $75,000 to their body corporate after failing to make payments.
- A body corporate applied to the Tenancy Tribunal to recover unpaid levies, interest, costs, and a filing fee from a unit owner who had not paid by the due date.
- A unit owner successfully challenged how their levies were determined, leading to an order for the levy invoices to be reissued.
- A body corporate charged interest at 10% per annum on a unit owner's unpaid balance after they failed to pay their levies by the due date.
📚 Legal basis
- Unit Titles Act 2010
❓ Frequently asked questions
What are levies in a unit title property?
Levies are regular payments made by unit owners in a unit title development to cover the shared expenses of the property, such as maintenance, insurance, and administration costs, determined by the body corporate.
Who decides how much the levies are?
The body corporate, which manages the unit title property, determines the levies payable. Each unit owner's share is typically calculated based on their utility interest in the property.
What happens if I don't pay my levies on time?
If you don't pay your levies by the due date, the body corporate can charge interest on the unpaid amount, up to 10% per annum. They can also apply to the Tenancy Tribunal to recover the unpaid levies, interest, and any associated costs like legal or debt collection fees.
Can I dispute the amount of levies I'm being charged?
Yes, you can dispute how levies were determined. In some cases, the Tenancy Tribunal has found defects in how levies were raised and ordered invoices to be reissued.
Are there different types of levies?
Yes, levies can include annual levies for general expenses and specific levies for particular projects, such as 'roofing levies' for major repairs, as seen in some cases.
Where can I find the rules about levies?
The rules regarding levies for unit title properties are primarily found in the Unit Titles Act 2010, which outlines the obligations of unit owners and the powers of the body corporate.