Calculation of Levies

The calculation of levies is done by using the formula of the participation quota of each unit in a sectional title scheme, in order to determine their contribution towards the repair, upkeep, management, control and administration of the common property.

The function of a body corporate in the Sectional Title Act

In the Sectional Titles Act, the entrusted functions of a body corporate include the establishment of funds to cover administrative expenses, the payment of rates and other local municipal charges, as well as raise the levy contribution on the owners in proportion to the participation quota of their section.

What is a participation quota?

According to the Sectional Titles Act, a participation quota is a formula used to determine the percentage that an owner should contribute towards the collection of levies.

The participation quota of a section is expressed by four decimal places which can be arrived at by dividing the floor area to the nearest square metre, as determined by the developer.

The formula for the calculation of levies

Levies can be calculated using the following formula:

Calculating a participation quota

Total square meters of a sectional title scheme ÷ Total square meters of each unit = Participation Quota.
e.g.  1162 m2    ÷     95 m2   =  8.1756

Calculating a levy

Total budgeted amount x participation quota of the unit = Amount 
e.g.  R 221 088.00    x    8.1756    =    R 180 7527.05
( R180 7527.05    x    100.0000) ÷ 12    =    R 1506.27
Rounded off to a total of R 1506.00

Van Deventer and Van Deventer Incorporated

If you have any queries relating to the calculation of levies, or if you want a clarified understanding of the participation quota, contact the experts at Van Deventer and Van Deventer Incorporated.

 

Buying a Home for the First Time – A Consumer’s Guide

[Title]

When it comes to buying a home, many first-time buyers don’t realise that there are many factors to take into consideration throughout the entire buying process. This article aims to provide some important guidelines to consumers who are looking at buying a home.

Read More ...
Posted by Cor van Deventer on Monday, January 6, 2020 Views: 39

 

Are Signatures Required on Sale Agreements and Contracts?

[Title]

Many may wonder whether it’s necessary to have a witness signature on a legal document such as sale agreements and contracts. However, a witness signature serves as evidence to the fact that each party to the agreement did in fact sign the document in question.

Read More ...
Posted by Cor van Deventer on Tuesday, December 17, 2019 Views: 42