Property glossary
Special levy
Also known as: special contribution
An additional once-off or limited-term levy raised to fund an expense the approved budget does not cover.
Definition
A special levy is an extra contribution the trustees raise on owners when the scheme faces an expense that was not provided for in the approved budget — for example an urgent major repair or an insurance shortfall. It can be payable in a lump sum or in instalments and is separate from the ordinary monthly levy. Like ordinary levies it is normally apportioned among owners according to their participation quota.
In the South African context
Under the Sectional Titles Schemes Management Act 8 of 2011 (STSMA) and its management rules, trustees may raise a special levy during a financial year to meet a necessary expense not included in the approved budget, and they decide whether it is paid in one sum or by instalments. Owners who buy into a scheme become liable for special levies raised after transfer, so disclosure before sale matters. A special levy must still be applied to the purpose for which it was raised.
Example
A scheme needs R250 000 for emergency roof repairs not in its budget; the trustees raise a special levy, so a unit with a 5% participation quota is billed R12 500, payable over five months.
Why it matters
Special levies let trustees respond to unbudgeted emergencies without waiting for the next AGM, but they are a common source of owner disputes, so the basis and purpose must be properly recorded and communicated.
Informational only — not legal advice. Confirm specifics against the current Act and your scheme’s rules.
Sources
- STSMA — Sectional Titles Schemes Management Act 8 of 2011 and management rules — trustees may raise a special levy for expenses not in the approved budget