Discount and Penalty Interest on Contributions

Most bodies corporate decide at a General Meeting whether to allow a discount for prompt payment of the body corporate contributions and also, whether an interest penalty is to be charged to lot owners who have not paid their contributions by the due date. The Body Corporate Managers are required to enforce the discount and penalty interest strictly in accordance with the resolutions passed at a General Meeting i.e. Annual General Meeting (AGM) or an Extraordinary General Meeting (EGM).

From time to time certain owners may have a legitimate reason for being granted the discount outside of the initial discount period or genuine hardship that makes the charging of the discount and penalty interest unreasonable. These owners should write to the committee asking for the discount to be granted and/or for the penalty interest to be waived, advising the committee of the reason for the late payment of their levies. The committee may then make an appropriate decision. We have included a proforma letter showing how to ask the committee to consider the discount and/or for the penalty interest to be waived.

 Getting your discount back

There are many cases of people’s Body corporate levy notices not being received on time, or simply not being received at all.

Below are some steps and information on what if your notice was not received and you wish to apply for the lost discount to be credited back to your account.

First step, full payment of the outstanding amount is required in order for your application to be considered, this will also prevent any overdue interest and penalties being charged against your account.

Forward the completed form to your Body Corporate Manager. Once the completed form has been received, your body corporate manager will then table your application to the committee at the next Committee meeting for their review and consideration.

This will be advised to you on return of the completed form. If a meeting has not been scheduled, you will be notified as soon as possible as to when the meeting will be held.

If the application is approved by the committee for your Body Corporate, the discount will be applied to your account as a credit, usually any processing fee’s for the application will be charged to your account at this time.

It is important to understand that it is not up to your Community Manager to make the decision on whether or not your discount application is approved; this decision is entirely up to the Committee for your Body Corporate.

When completing a discount application form, it is highly important to make sure you state clearly the description of the discount i.e. the levy period which you are requesting the discount to be credited for and that you wish for the amount to be reapplied to your account, a legitimate reason as to why you believe the discount should be reapplied and last but not least, your building information, lot number and contact details.