Q: Is it legal for a Lot Owner/resident to offset their strata levies with agreed payment for work undertaken at the property, eg. lawn mowing, repairs, etc. Should levies be independant of any arrangement for paid work between an owner and the Owners Corporation and paid separately to avoid confusion and transparency.
Is it legal for a Lot Owner/resident to offset their strata levies with agreed payment for work undertaken at the property? – Coral, NSW
The Act precisely specifies that levies are apportioned to lot owners by unit entitlement. Any variation to this is not possible. Any arrangements by an owner for services rendered must be handled separately.
In short, the lot owner is to pay the levy in full with any charges for services rendered by submitting an invoice as a creditor for the owners corporation to pay from the trust and not from anyone’s lot account.
If the works are not voluntary, the owners corporation should also consider its liability to engage a service provider legally.
Matters to consider are:
– If they are declaring the money earnt
– If they have a registered business (ABN)
– Have they the required licenses for the works?
– Do they have adequate insurance for such work (if they hurt themselves or others, do they have sufficient coverage and not seek a claim from strata)?
Whilst it may sound like an easy solution to offset their levies, the arrangement is not recommended due to the owners corporation requirement to run a legal trust account per The Act.