straita

Finance

What happens if our capital works fund can't cover an urgent repair?

Published 18 July 2026

Short answer

An emergency special levy is a one-off levy the owners corporation raises to pay for an unbudgeted or urgent cost the funds can’t cover — for example an urgent statutory repair. It is decided at a general meeting, and each lot’s share is worked out by unit entitlement in the same way as ordinary levies. Where the levy is for urgent repairs to the building, owners can be given a shorter notice period to pay than the standard levy notice.

When a special levy is needed

If a scheme has an urgent obligation to repair the common property and there isn’t enough in the fund to do it, the owners corporation is legally required to raise the money — and a special levy is the usual mechanism. Unlike ordinary levies set once a year at the AGM, a special levy is raised by a resolution at a general meeting (an AGM or an extraordinary general meeting) called for that purpose.

What it means for owners

  • The amounts can be large — potentially thousands of dollars per lot, all at once, because the whole cost is split across the scheme by unit entitlement.
  • Notice to pay: owners must generally be given at least 30 days’ notice for a levy. For a special levy raised to fund urgent repairs to the building, a shorter notice period applies — NSW Fair Trading guidance states at least 14 days.
  • Any amount left unpaid can attract interest at 10% simple per year, charged from one month after the due date, and the owners corporation can also recover reasonable recovery costs.

Confirm the notice window: the exact notice periods and what counts as an “urgent” repair are set by the Act and Regulation and can change. Confirm the current figure against NSW Fair Trading and the legislation before relying on it for a specific levy.

The real lesson: don’t let the fund run dry

Emergency levies are the symptom; an underfunded capital works fund is the cause. A realistic, regularly updated 10-year capital works plan is what stops a committee ever having to send owners a shock bill on short notice.

Straita and staying ahead of it

Keeping the plan current, the fund tracked and the levies issued on time is exactly the routine that prevents the emergency in the first place. A self-managed scheme running on a platform such as Straita keeps the capital works plan, the fund balance and the levy notices in one place, so a shortfall shows up early — as a planning decision the committee can make calmly, not a crisis bill with days to pay.

Primary sources