This article discusses Canberra strata levy grace period rules and when interest is charged on overdue levies.
Question: Is there a 30 day grace period for levy payments in Canberra before interest is charged on the overdue amount?
Our strata manager claims that there is a 30 day grace period in Canberra that follows the due date for payment of levies during which time levies don’t have to be paid. They also claim that arrears and penalty interest do not accrue until after the expiration of the grace period. I can’t find any reference to a grace period in the Unit Titles Management Act. On the contrary, it is very clear that levies are due and payable on the due date and that interest accrues if levies are not paid by the due date. Is our strata manager correct?
Answer: Most strata managers have a default grace period
Most managers have a default time frame for grace especially to cover late meetings, public holidays, reduced quorum decisions having to wait 28 days etc.
No interest is charged during the grace period but if paid outside the grace period then the interest is normally calculated back to the due date. The Owners Corporation can also vary the rate of interest to be charged but the usual default is 10% but I do know that during high interest rates some plans increased this to 20% as the interest rate on outstanding levies at 10% was less then some mortgage rates.
But each management company and Owners Corporation may set their owner rules.
This post appears in Strata News #514.
Jan Browne Bridge Strata E: jan@bridgestrata.com.au P: 02 6109 7700