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Hi Cate, I don’t know what the laws pertaining to this would be in WA. We had a similar problem in a strata I used to live in (NSW). This is how we approached it:
Give the present owner a decision of the EC that there are unauthorised works that must be undone:
During the sale process, a prospective new owner will require a notice from the OC re the unit. In NSW this is under s108 of the relevant act. Ensure that any prospective buyer is notified of the unauthorised works and that the works will have to be undone (even if the new buyer must pay for them).
The new buyer can then negotiate with the present owner. The important point is to get to prospective new owner as soon as possible.
PeterC is correct, the most important question that our EC had to ask was:
If there is an accident involving the railings and someone sues us will the insurance company payout or will they dispute our claim based upon the fact that the old railings should have been replaced?
I think it still might be worthwhile making enquires with the ATO or someone qualified to give advice. Registering and subjecting any Strata to the GST is not something to do unless you are sure you have to.
The whole issue, to my mind, hinges upon what a Strata’s turnover is. If your turnover is more than $75,000 you will be subject to the GST business requirements.
However from this ATO site:
https://www.ato.gov.au/Business/GST/Registering-for-GST/Working-out-your-GST-turnover/
turnover is defined as (emphasises added):
“Your GST turnover is your gross business income (not your profit), excluding any:
- GST you included in sales to your customers
- sales that are not for payment and are not taxable
- sales not connected with an enterprise you run
- input-taxed sales you make
- sales not connected with Australia.”
My view is that Levys are not income (taxable) and anyway would qualify as being excluded from the definition of turnover under “sales that are not for payment and are not taxable”.
Most Stratas don’t carry on a business and unless they receive considerable income from other activities eg interest or renting out common property I don’t think they would be caught.
I am quite happy to be corrected on this as it is a very relevant and important issue for Stratas that have levys approaching the threshold.
I am not so sure your Strata manager is correct. Levys aren’t income for taxation purposes but they may be included as part of the turnover that would put you over the GST threshold.
Moving from paying the GST (as your Strata does at the moment) and being required to deduct and remit GST to the tax office is a large administrative burden.
Get a opinion in writing from the Tax Office it won’t cost you a cent and then you have it in writing. The letter should just ask the question:
Is our Owner’s Corporation liable to register and pay GST? If so on what amounts?
Set out the facts ie amount of levys both admin and sinking, interest income and any other income eg rent from leasing common property.
The railings are only required to be brought up to current standard if there has been any modification/repair/rectification work done that affected them.
For example in our Strata when installing cladding to the outside of the building the railings were modified to better attach them to the building. When we looked into it, because we had them modified we were required to ensure they complied with current standards.
@scotlandx said:
You can do the tax return yourselves, it’s not hard.I would add one thing to scotlandx’s reply. To work out what is the best course of action do some sums.
1. How much could you earn in interest?
2. How much tax would have to be paid on that interest (30% of interest earned).
3. How much would it cost you to get your tax return done and lodged. Scotlandx is right it is easy and I would ring the tax office and ask for “Strata title body corporate tax return” (the tax office will post you at no cost) and have a look at it.
JimmyT, I have seen owners claim excessive fees but when I have gone through the accounts etc the level of fees was appropriate. I am not saying this is the case here but it is not always that simple.
Relevant questions that you should be making enquiries into are:
1. What do the accounts show? Are there any unnecessary expenses and is all income accounted for?
2. Are payments from accounts properly made and competitive? eg the strata isn’t being overcharged for work (including management fees).
3. What does your sinking fund show in the way of planned future expenditures that are necessary?
As long as your fees are properly spent and accounted for too high fees should only result in large balances in your sinking and/or admin fund.
As long as you can prove the Owner owns/controls the subject car surely they are responsible.
I know of no law that would mandate what your new manager says. The manager works for the OC and while that includes giving you advice, in the absence of your manager quoting either a specific piece of legislation or a decided case I would just give your manager a direction that the Notice to Comply be issued.
@alinka said:
Hello, could somebody let me know, if AGM Minutes can be retrospectively adjusted. The AGM minutes were already approved and adopted by the follow up General Meeting. Now one of the OC member would like to have them adjusted again on the forthcoming AGM, despite that they were already approved and adopted.Is this possible at all?
alinka
I don’t think adjusting prior minutes that have already been aprproved is possible.
I think the only course of action is to put a motion at the next AGM noting that the minutes were incorrect and putting on record the reason why.
Claire, hi and it sounds like you took all the precautions available to you I was just checking as from your original post it wasn’t clear.
As for the correspondence being selectively sent. I know of no rule against it but it does sound a bit secretive and (to use a legal term) “a denial of natural justice” to not let you know of its full contents.
Claire, I think you will find that the EC feels a bit defensive by and feel you did the wrong thing by moving in and then asking for permission. The correct procedure would have been to ask before you moved in. You probably need to show a bit of remorse for not following the correct procedure.
I think the EC should provide you with reasons which you can dispute. The issue is whether the approval was ‘unreasonably’ denied.
Claire, from reading your post I assume you moved in with a dog without getting permission, would that be correct? If you have, you probably need to show a bit of contrition as you should have sought approval prior to moving in. So the EC may be a little off side defensive.
If the answer is no, the Owner’s Corporation should supply you with reasons why and you consider the reasons ‘unreasonable’ can dispute them.
@jpickup said:
Is there a minimum dollar value for a Sinking Fund? Can it go to $0. I have been told that there is a minimum of 1% of the value of the plan.In NSW the requirement to do a forward plan at least every 5 years should establish the minimum amount needed to undertake the maintenance required.
Refer STRATA SCHEMES MANAGEMENT ACT 1996 – SECT 75A. Wherein legislation was passed to ‘phase in’ mandatory 10-year sinking fund plans beginning from July, 2006 for all NSW Strata Schemes. Essentially all NSW Owners Corporations now have to have 10-year sinking fund plans done for their Strata Schemes in an effort to eliminate the problems of ‘insufficient long term capital works funding’ .
OMG,
Our strata had a similar problem in regard to balcony railings. Because we had work done that affected them we needed to bring them up to current code. I raised the issue (again and again) and in the end was told that it was only because I had brought it to the notice of the OC that we had to do it.
One committee member told me that if I hadn’t put my concerns on record we would have been covered by insurance. I took this view to a lawyer and was told that view was incorrect. Everyone is assumed to know the law and it all gets down to how a ‘reasonable’ person who act. In our case the first thing that would have happened if we had a claim to do with the balcony and especially if it was a big claim, is that the insurance company and maybe workcover would have had investigators look at the circumstances. The condition of a high use item such as balcony railings is something a reasonable person would notice. Also as we had had work done that affected them we couldn’t plead ignorance.
The lawyer said, for strata containing residential units only, it is similar to a car defect for non commercial car owners. Except for high use and visible items eg tyres and windscreens you don’t have to carry out detailed inspections yourself. In most cases ‘everyone keeping their eyes open for obvious potential hazards would suffice’. After all how many home owners do you know who have WH&S audit and ACM audit at the place they live in?
1. How worried should I be?
In regards to the problem you have identified very.
2. Should I force the Committee to act? If so, how?
Absolutely, what I said was if we have an incident and say a large claim is made the insurance company will send an investigator and try to find a way to not pay.
3. How can I protect myself financially –
I don’t know if you can!
I use excel spreadsheet and I am quite happy post the one I use to present our strata accounts. I don’t know how to post an attachment here. Alternative if you supply me an email address I will email them to you.
@Whale said:
Responses please……