Monthly/Quarterly Service Charges are collected by the Joint Management Body or Management Corporation for the administration and management of the common areas of the jointly owned property, and for the building insurance. A monthly/quarterly bill would be sent to advise you of your payment. However, as the amounts are consistent owners are advised not to wait for the invoice but make payments before the due dates.

Monthly Service Charges are based on an annual budget for the common property prepared by the Committee and the Managing Agent and approved at the Annual General Meeting. Each owner will pay their share of the Service Charges in accordance with their Unit Share Entitlement as set out in the Strata Titles Certificate.

There are several options for making your Service Charge payments.

1. Log on to your building MyStrata/My Community web portal and make easy convenient payments on line. This can be done by electronic transfer payment or increasingly by credit card. More and more communities are now being offered the credit card facility for payment of t their service charges. Credit card facilities are available for your building if the option comes up when you log onto your buildings My Strata/MyCommunity web portal.
2. If you wish to pay in cash, you can:
   • Pay by direct deposit or telegraphic transfer to the bank account shown on your service charge invoice and informing the office of your payment; or
   • Deliver the cash to our Management Office located in your Condominium and obtaining an official receipt thereof.
   If you wish to pay by Cheque, make your cheque payable to the payee shown on your Invoice. You can deliver the cheque in one of the following ways:
   • Drop it into the Collection Box in the lobby of your building or outside the management office in your building
   • Deposit the cheque directly into the Joint Management Body/Management Corporation bank account
   • Mail it to the official address of your condominium.
   IMPORTANT:
   • Always be sure you include your Unit Number as a reference.
   • Please allow sufficient time for your cheque to clear prior to the payment due date
   • Both sender and receiver bank transfer fees must be met by the customer
   • For any assistance with your service charge payments, please call your condominiums management office

All Owners are responsible for the payment of Service Charges on or before the date shown as the due date on the Invoice raised by the Managing Agent. The following are the steps that are taken by the Managing Agent in the event that Service Charges are not paid.

1. INVOICING Invoices will be prepared and issued not less than 14 days prior to the Due Date. The Managing Agent will issue a maximum of 2 further Reminder Notices, each accompanied by a statement of account if necessary.
2. REMINDER NOTICE The 3rd Reminder Notice issued by the Managing Agent is the final notice, and will be accompanied by a Demand Notice. The Demand Notice is a formal warning to the Owner that further delay in payment will result in the Management Committee declaring the account a “Late Account”, and instructing the Managing Agent to :
   • Implement the collections procedures;
   • Withdraw services and access to applicable leisure facilities and common areas of the building as defined in the Community Rules;
   • Impose the approved penalty charges;
   • Initiate debt recovery or other legal action to recover the unpaid service charges as prescribed in the regulations, at the cost of the owner;
   • Issue a Notice to the tenant of the Owner advising that these actions will be taken; and
   • Place on the notice board of the condominium indicating units which have not paid their dues.
3. LATE ACCOUNT Accounts which remain unpaid for 60 days after the due date will be deemed “Late”. Late Accounts will incur Late Payment Fees of :
   • Penalty charges of 10% per annum (10% p.a.) backdated to the Due Date;
   • All costs of collection including but not limited to the fees of external debt collection agencies, penalty fees, returned cheque fees, and all legal and other administrative costs incurred in the collections process.
4. DEFAULT ACCOUNTS Late Accounts which are not rectified within 14 days, will become Default Accounts. In the event of an account becoming a defaulting account, the Management Committee will:
   1. Issue a formal Notice of Default to the Owner. The Managing Agent will provide with this letter:
      • Copies of the relevant sections of the SMA 2013 and Form 1;
      • Copies of all correspondence with the Owner, including the Service Charge invoices, Reminder Notices and evidence of their receipt in accordance with the SMA 2013.
   2. Request the Strata Management Tribunal to hear the matter of the property Owner being in default, and initiate the legal remedies available to the Joint Management Body/Management Corporation under the SMA 2013.
   3. Enter the Owner on the defaulting land owners register held at the Tribunal and give an order for the defaulting owner to pay amount due.
5. APPEALS PROCESS Prior to the Management Committee taking action to declare a Default Account and initiate Debt Collection, Owners are able to appeal to the Management Committee to seek a review of their case. At the discretion of the Management Committee, the charges owing and / or negotiate alternative payment arrangements.
6. LEGAL PROCESS – DEFAULTING UNIT OWNERS Prior to the Management Committee taking action to declare a Default Account and initiate Debt Collection, Owners are able to appeal to the Management Committee to seek a review of their case. At the discretion of the Management Committee, the charges owing and / or negotiate alternative payment arrangements.
7. WRIT OF SEIZURE AND SALE OVER THE ASSETS IN THE SUBJECT PROPERTY After 30 days in default of the Tribunal Judgment and Order, notification will be issued by the Management Committee, advising that a Writ of Seizure and Sale has been obtained on the property in favour of the Joint Management Body or Management Corporation.
8. 30 DAYS AFTER THE DEFAULT NOTICE If the payment arrears remain un-remedied after 30 days from Tribunal Judgment and Order, the Joint Management Body or Management Corporation will apply to the Court for execution of the Writ of Seizure and Sale on the property. The assets in the property will be sold and the proceeds of the sales of the assets will be used to pay the outstanding arrears and legal costs.

Service charge budgets are prepared by the Managing Agent in collaboration with the elected Management Committee. The Service Charge budget includes two key cost elements – the Management Fund and the Sinking Fund. The Management Fund budget includes all known annual operational costs of the building including the annual maintenance contracts for major plant and equipment, maintenance agreements for other mechanical services, lift service contracts, fire and safety contracts, certifications and inspections, along with the various soft services such as cleaning, concierge security and so on. These costs plus insurances, audit charges and administration costs establish the annual budgeted cost for the building. The Management Fund and the Sinking Fund together make up the Annual Service Charge budget. The Sinking Fund is normally fixed at 10% of the Service Charge Budget.

This cost is then apportioned among all units in accordance with the share unit entitlement contained within the Strata Titles Certificate registered at the Land Department. The entitlements table can be viewed by any owner at any time by contacting the Condominiums Managing Agent.

The service charge budget is approved by the Joint Management Body/Management Corporation at a duly convened General Meeting prior to invoices being distributed. The Management Committee examines the budgets to ensure they are reasonable for the standard of the building, include all elements that should be shared by all owners, and have been formulated according to SMA 2013 guidelines.

Interest is charged on all late payments towards the Service Charges. This is to ensure that a fair system is in place to encourage timely payments. Those who pay late normally affect the cash flow of the operation expenses and therefore should be penalised by way of interest charges. Interest on Service Charges is regulated by SMA 2013 Section 60 (3)(c). It is set by the Management Corporation at a duly convened General Meeting which shall not exceed 10% per annum. A lower amount could be decided by the owners at the General Meeting.

You own the apartment and have a share of the common property and therefore it is your obligation under the SMA 2013 to pay to ensure the apartment is properly maintained. Well maintained apartments will attract good well paying tenants and prospective purchasers.

The Managing Agent is appointment by the Joint Management Body/Management Corporation to assist the appointment Management Committee to manage the Property. Their scope of work is normally set by the Management Committee and undertake the responsibilities of the Management Committee as required under the SMA 2013 and one of it is as per section 78 of the SMA 2013 “Procedure for recovery of sums due”. If the Managing Agent is given the Authority by the Management Committee via the signing of a Contract then they can take action against you for non -payment of service charges.

Your occupancy of the unit is as per a Tenancy Agreement with covenants and terms binding you and your landlord. One of the Landlords Covenants is to pay Service Charges promptly. Your covenant is to abide by the Act 2013, its By-Laws And the Condominium House Rules and By-Laws. The SMA 2013 binds the Landlord and the Management Corporation. The SMA 2013 also binds the tenant against any restriction imposed against a proprietor for defaulting in payment as per Sec 6(1)(b). Under this Act the proprietor has to pay Service Charges promptly and failure to pay has repercussions such as the Joint Management Body/Management Corporation invalidating access cards for the use of facilities as provided for under the 3rd Schedule of the SMA 2013, Part 3 (Sec 6)(4)(5). Therefore, your landlords failure to keep updated accounts will affect you as tenant.

A Sinking Fund is a fund set up by the Joint Management Body/Management Corporation to cover the costs of known future capital expenses. Sinking Funds are set aside for such things as repainting and repairing the building exterior and structure and the replacement of common property items such as lifts and electric motors.

The Joint Management Body or Management Corporation are recommended to have a minimum ten-year Sinking Fund plan in place. This means that Management Committee must plan how they will repair and maintain common property and raise sufficient funds to cover the cost as the building components deteriorate over the lifetime of the building. A lesser term or longer term can also be planned from between 5 years to 20 years.

The amount required for the ten-years Sinking Fund plan will vary significantly between different buildings. For instance, newer developments may require relatively less money to be set aside than an older development which are both registered at the same time as the older building would invariably have more repair work due and less time to accumulate the funds. Each Sinking Fund plan should reflect the individual needs of its development.