Understanding your strata levies and funds: What every owner needs to know

Types of Funds in Strata and Body Corporate Schemes

If you own property in a strata, owners corporation or body corporate scheme in Australia—whether in NSW, QLD, VIC, or the ACT—you’re likely to be familiar with levies. But what exactly do they cover, and how are they structured across different states?

Although terminology and legal frameworks may vary slightly, the purpose behind levies remains consistent: they ensure the smooth operation, upkeep, and financial health of your shared property.

All strata, owners corporation or body corporate schemes collect levies from all owners, which are allocated into various funds to manage different aspects of the property.

1. Administrative Fund

This is the “day-to-day” fund used for regular expenses, including:

• General maintenance and repairs to common property
• Insurance premiums for the building and public liability
• Utilities for shared areas such as lighting, lifts, and water
• Management fees, cleaning, and gardening services
• Regardless of your state, this fund is essential to keep everyday operations running smoothly.

2. Capital Works / Sinking / Maintenance Fund

This fund is used for major works and long-term upgrades. While names differ—NSW calls it the Capital Works Fund, QLD and ACT use Sinking Fund, and VIC calls it the Maintenance Fund—they serve the same purpose:

• Large-scale repairs (like roof replacements or façade restoration)
• Repainting and refurbishment of common areas
• Replacing shared infrastructure (e.g. lifts, intercom systems, lighting)
• Sustainability upgrades (such as solar panel installation)

3. Maintenance Plans

NSW requires a 10-year plan from the first AGM, reviewed every five years, to ensure the capital works fund is adequately prepared for future expenses.

While VIC also requires a plan in some circumstances, the ACT currently doesn’t mandate a formal long-term forecast, but many schemes adopt one as best practice. In QLD, a body corporate must budget for major expenditure for the current financial year and the next 9 years. Whilst not compulsory, engaging a professional to prepare a sinking fund forecast is considered good governance and can assist the committee with appropriate budgeting.

4. Voluntary/Service-Specific Funds

Some owners corporations or bodies corporate may create optional service funds for amenities like high-speed internet, cable TV, or electric vehicle chargers. These are entirely voluntary and must be approved by a resolution at a general meeting. Only those who opt in contribute to these costs.

Staying Informed

Understanding how your levies are allocated enables you to make informed decisions as an owner and engaged member of your community. Levies are proposed and approved collectively by owners at the AGM, ensuring transparency and shared responsibility.

If you’re unsure about your scheme’s specific arrangements or would like to review your long-term maintenance plan, we encourage you to contact your strata committee or managing agent for guidance.

By taking an active interest in how your contributions are managed, you’re not simply paying fees—you’re playing a vital role in maintaining the value, functionality, and future sustainability of your property.