Sunday, February 21, 2010

Body Corporate Levy Rules to Change

From a SSKB Newsletter:

The share that each owner pays to their body corporate levies may change, yet again, when the government commences new laws about how contribution lot entitlements are calculated.

In a major omission that the changes to body corporate lot entitlements made in 1997 were unfair to many, the Queensland Minister responsible for body corporate law, Peter Lawlor, today announced that the basis for setting lot entitlements will revert to the principles used prior to 1997.

Under the 1997 principle the entitlements must be equal unless it is just and equitable for them to be otherwise. This principle changes under today’s announcement.

For standard format plans contribution entitlements will be based on the unimproved capital value of the land – so it will be similar to land tax and your council rates.

For building format plans (apartment style dwellings) the system will be a combination of factors that the minister describes as “market conditions and property value”. The impact of this will need to be considered once the legislation is finalised.

It appears clear that this new “old system” will apply to new developments. However, it is unknown what will happen to developments that are currently being sold off the plan.

Any body corporate where the lot entitlements have already changed from the pre 1997 system to the 1997 system because an owner made an application to have the entitlements altered are in for some more substantial upheaval as the Minister has stated the new law will see the entitlements revert to the way they were before.

At this stage the announcement lacks detail. It is unclear what happens to developments that were completed under the 1997 system and have used that principle for calculating entitlements instead of the new principles.

No comments: