Special Levies in Strata — What They Are and What to Do (Australia 2026)
A special levy is an additional levy raised by an owners corporation (body corporate) outside the normal quarterly levy cycle to fund an unexpected or unbudgeted expense. They can be a significant and unwelcome financial burden — particularly if large and imposed with short notice.
Why Special Levies Are Raised
Special levies arise when the owners corporation needs funds that are not available in either the administrative or capital works fund:
| Reason | Example |
|---|---|
| Major unplanned repair | Storm damage to roof not fully covered by insurance; structural failure requiring emergency repairs |
| Insufficient capital works fund | Building has aged but not saved enough — major replacement cannot be deferred |
| Cladding remediation | Fire-safety defective cladding removal and replacement (significant issue in high-rise buildings post-Grenfell) |
| Legal costs | Litigation by or against the scheme |
| Builder defect rectification | Defects not covered by builder warranty; scheme must fund rectification |
| Insurance shortfall | Damage payout insufficient to cover full reconstruction cost |
| Fire safety upgrades | Compliance orders requiring installation or upgrade of fire safety systems |
How Much Can a Special Levy Be?
Special levies vary enormously by building type, number of lots, and the work required. Per-lot figures:
| Scenario | Typical range per lot |
|---|---|
| Minor unplanned repair (e.g., garden irrigation system) | $200–$2,000 |
| Major common area repair (balcony waterproofing) | $2,000–$15,000 |
| Significant building works (roof, lift) | $5,000–$30,000 |
| Cladding remediation (high-rise affected building) | $30,000–$100,000+ |
| Fire safety compliance (major system upgrade) | $10,000–$50,000 |
These are indicative ranges. High-rise buildings in major cities with complex issues (cladding, defects, fire safety) have seen special levies of $50,000–$200,000 per lot in extreme cases.
How a Special Levy Is Approved
In most Australian states:
- A special levy resolution is passed at a general meeting (or in some states, a committee meeting may be able to approve smaller amounts within set limits)
- Notice of the meeting and proposed special levy must be provided in advance (typically 7–14 days)
- A simple majority is usually sufficient (some states require a special resolution for very large amounts)
Timeline: The resolution specifies the amount, the due date, and whether it is paid in a lump sum or instalments.
Can You Refuse to Pay a Special Levy?
No — a lawfully passed special levy is a legal obligation of all lot owners. Non-payment:
- Accrues interest
- May result in recovery action by the owners corporation
- Can lead to a judgment debt and potentially a caveat on your title
You may challenge an improperly passed levy through the relevant state tribunal (NCAT in NSW, VCAT in VIC, QCAT in QLD, etc.).
Buying Into a Scheme With a Proposed Special Levy
If a special levy is proposed but not yet passed: The sale contract may not disclose it. You should ask:
- Whether there are any known proposed or anticipated special levies
- Review the meeting minutes for discussions about upcoming major works
If a special levy has already been passed and is outstanding:
- Outstanding levies are a liability of the owner at the time they were raised
- In most states, the vendor (seller) is responsible for levies up to settlement — the buyer takes over from settlement
- However, if a levy has been passed but future instalments are due, the buyer takes on those future instalments
Your conveyancer should identify any outstanding or proposed levies through the strata inspection report and levy certificate.
Can the Owners Corporation Borrow Instead of Raising a Special Levy?
In most Australian states, an owners corporation can borrow money (subject to a resolution) to fund major works. This spreads the cost over time (via higher regular levies to service the loan). Borrowing may be preferable to a large lump-sum special levy for owners under financial pressure.
However, not all strata schemes use this option — it depends on the scheme’s strata manager’s approach and the committee’s preference.
Frequently Asked Questions
I was told there were no special levies when I bought. A levy was raised a month later. What can I do?
If the levy relates to works or defects known to the vendors (sellers) before settlement, you may have a claim for misrepresentation. Speak with a solicitor promptly. If the levy relates to a new and genuinely unexpected event, you are generally not entitled to compensation.
The special levy is for cladding replacement — is government assistance available?
In Victoria, the Victorian Cladding Taskforce and the Cladding Safety Victoria program have provided government assistance for some affected buildings. NSW has had some building remediation programs. Check current state government programs — availability has varied. This is a rapidly evolving area.
Can I pay the special levy in instalments?
The resolution will specify payment terms. Some schemes allow instalments; others require a lump sum. If you are facing financial hardship, contact the strata manager immediately — the owners corporation may consider a payment plan.
Related Strata Guides
- Strata Levies Explained — Admin Fund and Capital Works Fund
- Cladding and Fire Safety — What Apartment Buyers Must Know
- Body Corporate Disputes — What Are Your Rights?
- Strata Title Australia Hub
This article provides general information about special levies in Australian strata schemes. Strata legislation and levy recovery processes vary by state. For advice about a specific special levy, speak with a licensed strata manager or solicitor. Find one through MoneySmart.