Sectional Title Levies Explained: The Trustees’ Complete Guide (STSMA 2026)

If you’re a trustee, body corporate chairperson, or sectional title owner in South Africa, levies are the financial lifeblood of your scheme. Get them wrong and you’re looking at cash-flow crises, legal disputes, unenforceable debt collection, and personal liability exposure for trustees.

This guide explains everything: how levies work under the Sectional Titles Schemes Management Act (STSMA), how to calculate them correctly, collect them lawfully, reconcile them against bank statements, and stay compliant with the Community Schemes Ombud Service (CSOS).

What is a Levy?

A levy is the monthly (or periodic) contribution every unit owner in a sectional title scheme must pay to the body corporate to fund the running, maintenance, and long-term upkeep of the common property.

Levies are not optional. They are a statutory debt under the STSMA, and non-payment has severe legal consequences — for both the owner (losing voting rights, interest charges, debt collection) and the trustees (personal liability if mismanaged).

The Two (or Three) Types of Levies

Under the STSMA, there are two mandatory levy funds and one optional:

1. Administrative Fund Levy (Monthly)

Covers day-to-day expenses:

• Security
• Garden maintenance
• Pool service
• Cleaning common areas
• Electricity and water for common property
• Insurance (building, public liability)
• Managing agent fees
• Audit fees
• Bank charges
• Minor repairs

2. Reserve Fund Levy (Mandatory Since 2016)

The STSMA requires every scheme to maintain a reserve fund for long-term maintenance and capital items (roof, paint, tarring, lifts, major infrastructure).

The reserve fund contribution must be at least:

A separate bank account for the reserve fund is mandatory. Co-mingling is an STSMA breach.

3. Special Levy (Optional, When Needed)

A once-off contribution for an unbudgeted capital expense (e.g. unexpected roof collapse, fire damage repair beyond insurance).

Special levies must be approved by trustee resolution and are payable by owners who were registered at the date the levy was raised, regardless of when they bought.

How Are Levies Calculated?

Under Section 3(1)(a) of the STSMA, levies are calculated based on each unit’s participation quota (PQ).

Participation Quota

The PQ is set out in the sectional plan and is the ratio of each unit’s floor area to the total floor area of all units. It’s typically expressed to 4 decimal places.

Example: A 10-unit scheme where your unit is 80 m² and total is 1,000 m² — your PQ is 0.0800 (or 8%).

Calculation Formula

Monthly levy = (Annual approved budget × Your PQ) ÷ 12

Example:

• Annual admin budget approved at AGM: R600,000
• Annual reserve fund budget: R120,000
• Total annual levy: R720,000
• Your PQ: 0.0800
• Your annual levy: R720,000 × 0.0800 = R57,600
• Your monthly levy: R57,600 ÷ 12 = R4,800

Non-Equal Contributions (PMR 31(4))

The trustees can — with a written resolution — differentiate levies for units based on differential use or benefit. For example:

• Ground floor units pay less for lift maintenance
• Larger units pay more for water (if unmetered)

This must be documented in a conduct rule or trustee resolution and cannot be done on a whim.

When Must Levies Be Paid?

Under the STSMA and standard management rules (PMR 21):

• Levies are payable monthly in advance by the first of the month
• Failure to pay by month-end triggers arrears
• Interest accrues at the rate determined by the body corporate (capped at the prescribed rate)
• Owners in arrears lose voting rights at AGMs on financial matters

Collecting Arrears: The Lawful Process

As trustees, you have a fiduciary duty to collect arrears. You cannot just “let it slide” — that’s a breach of duty to other owners. Here’s the process:

1. Day 1 of month: Levy payable
2. Day 7–10: Friendly reminder SMS/email
3. Day 15: Formal arrears letter with interest calculation
4. Day 30 (end of month): Letter of demand via attorney (s.14 CSOS) with 14-day notice to pay
5. Day 44+: File claim with CSOS (fastest, cheapest) OR magistrate’s court
6. Judgment: Garnishee, attach rent (if tenant-occupied), or apply for sale in execution of the unit

CSOS is your friend: The Community Schemes Ombud Service adjudicates levy disputes with binding orders — no expensive litigation needed. Cost: a few hundred rand.

Key Trustee Responsibilities Around Levies

1. Approve the annual budget before the AGM
2. Present the budget at the AGM for ratification by owners
3. Raise levies by resolution after AGM approval
4. Issue levy statements monthly to owners
5. Collect levies and deposit into the administrative account
6. Reconcile bank statements vs levy roll monthly
7. Reserve fund — ensure the maintenance plan is funded per STSMA
8. Annual financial statements — independently reviewed (not audited for schemes ≤ 10 units)
9. File returns with CSOS annually and pay the CSOS levy (R40/unit/year, capped at R500/month)
10. CSOS levy: R40/unit/month must be collected from owners and remitted to CSOS quarterly

The 10-Year Maintenance Plan

Every scheme must have a written 10-year maintenance plan (PMR 22), reviewed annually. It must identify:

• All major capital items (roof, paint, driveways, lifts, etc.)
• Their estimated lifespan
• Projected replacement/repair cost
• Funding schedule from the reserve fund

Trustees who fail to maintain and fund this plan can face personal liability for consequential damage.

Special Levies: The Legal Pitfalls

1. Only for unbudgeted emergencies — if you could have budgeted for it, a special levy is vulnerable to challenge
2. Must be raised by trustee resolution (minutes required)
3. Payable by registered owners as at date of resolution — incoming buyers only pay instalments that fall after transfer
4. Cannot be used to build reserves — that’s what the reserve fund is for
5. Must be deposited into admin or reserve fund (not a separate “special” account unless via resolution)

Levies on Unsold Units (Developer-Held)

Until a unit transfers from the developer to the first buyer, the developer is the owner and pays the levy. Trustees must invoice the developer and pursue arrears like any other owner.

Tenant Doesn’t Pay? Not Your Problem (Legally)

Levies are the owner’s obligation, full stop. If an owner leases to a tenant who doesn’t cover their rent — the owner still owes the levy to the body corporate. The owner’s dispute with the tenant is separate.

Trustees can, however, attach rent via court order if the owner is in arrears.

Record-Keeping (Keep 5+ Years)

• Levy roll (per unit, per month)
• Bank statements (admin + reserve)
• Reconciliations (monthly)
• AGM and trustee meeting minutes
• Budget and actuals
• 10-year maintenance plan
• Independent review/audit reports
• CSOS filings and receipts

Common Trustee Mistakes That Cost Schemes Dearly

1. Not raising levies by resolution — collection becomes unenforceable
2. Co-mingling admin and reserve funds — STSMA breach
3. Raising special levies for routine maintenance — challengeable at CSOS
4. Failing to issue monthly statements — weakens debt collection
5. Ignoring arrears — trustee fiduciary breach
6. Not filing annual CSOS returns — fines accumulate
7. No 10-year maintenance plan — liability for foreseeable failures
8. Budgets without owner approval — no enforceability

How BodmasBooks™ Helps Your Scheme

Our Sectional Title Books module is purpose-built for SA trustees:

• Automatic levy generation by PQ
• Arrears letters with interest calculation
• CSOS levy tracking and quarterly remittance
• Reserve fund segregation with 25% minimum alerts
• 10-year maintenance plan tracker with funding schedule
• Trustee meeting minutes and resolution archive
• AGM voting records
• Independent review-ready financial statements
• Owner portals so owners see their statements 24/7 (reduces admin queries by 70%)

Free 14-day trial at bodmasbooks.co.za — trusted by schemes from 4 units to 400+.

General guidance only. Sectional title law is complex — consult a CSOS-recognised managing agent or specialist attorney for scheme-specific matters.