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Levies: More Than Just a Number on a Statement
If you’ve ever sat in a trustee meeting and heard Sectional Title Levies being discussed, you’ll know it’s the moment when calculators come out, people shuffle in their chairs, and someone inevitably mutters, “Here we go…”
Levies may seem like just another line on the budget, but Sectional Title Levies are the fuel that keeps your scheme running. No levies, no lights. No levies, no gardener. And certainly no repairs when the lift decides it’s had enough. So let’s unpack the meaning of levies in plain English — without the legal jargon overload — so that the next time you’re in that AGM hot seat, you’re armed with facts (and maybe even a grin).
What Are Levies and Why Do They Matter?
In short, Sectional Title Levies are each owner’s share of the cost of running the scheme. The meaning of levies is simple: if the body corporate spends money, that money has to come from somewhere — and that somewhere is the collective pocket of all the owners.
Think of it like this: when you walk through the gate at night and the lights switch on, or when you step into a freshly cleaned lift that doesn’t smell like a forgotten takeaway, you’re seeing your levies at work.
The Sectional Titles Schemes Management Act (STSMA) says every body corporate must have:
- An Administrative Fund – For the daily bills (security, cleaning, insurance).
- A Reserve Fund – For the big-ticket jobs (painting the building, replacing the roof, major waterproofing).
How Are Sectional Title Levies Calculated?
Levies aren’t decided on a whim or plucked from thin air — they’re calculated using your unit’s Participation Quota (PQ).
A quick note on PQ: Every unit in a sectional title scheme has a PQ, usually based on the floor area of that unit compared to the total floor area of all sections. In simple terms, it’s your “share size” of the scheme. The higher your PQ, the bigger your share of the expenses — and therefore the higher your levy.
Your PQ is applied to the scheme’s total annual budgeted expenses to work out your contribution. Here’s a real-world example:
Let’s take a look at an example:
Total PQ = 2 000
Total budgeted expenses = R200 000
10 units, unequal PQ values
| UNIT | PQ | Levy |
|---|---|---|
| 1 | 100 | R10,000 |
| 2 | 150 | R15,000 |
| 3 | 180 | R18,000 |
| 4 | 200 | R20,000 |
| 5 | 220 | R22,000 |
| 6 | 250 | R25,000 |
| 7 | 280 | R28,000 |
| 8 | 220 | R22,000 |
| 9 | 200 | R20,000 |
| 10 | 200 | R20,000 |
| TOTAL | 2,000 | R200,000 |
Notice how Unit 7’s PQ is nearly triple Unit 1’s — and so is their admin levy. It’s not personal, it’s maths.
Trustees’ Legal Responsibilities
Trustees are legally required (under the Sectional Titles Schemes Management Act (STSMA)) to:
- Prepare a proper annual budget.
- Raise levies in line with that budget.
- Collect those levies — even if it means chasing arrears.
And when you’re handling owners’ personal details (banking info, contact details), you must comply with POPI Act compliance rules — lock it down, keep it secure, and don’t share it unless it’s legally required.
The Tricky Bits (and Why Legal Advice Helps)
If you’ve been a trustee for more than five minutes, you’ll know levy issues aren’t always straightforward. You might face:
- Arrears – And the awkward phone calls that follow.
- Disputes – Owners arguing about calculations or increases.
- Special levies – The AGM equivalent of announcing load shedding.
That’s when professional sectional title legal advice can save you headaches — and in extreme cases, save you from personal liability. Having legal help for trustees on speed dial isn’t a luxury; it’s insurance for your decision-making.
Best Practices That Keep the Peace
- Communicate openly – Don’t just raise levies; explain why.
- Be transparent – Share budgets and statements early.
- Stay compliant – The POPI Act is not optional.
- Use tech – Automate levy invoices and reminders so you can focus on running the scheme, not chasing paperwork.
The Bottom Line
Sectional Title Levies aren’t just about money — they’re about keeping your scheme liveable, compliant, and protected. When managed well, they’re one less thing for trustees to lose sleep over.
So next time you see “Levy Increase” on the AGM agenda, you can smile, knowing you understand exactly what’s going on… and have the confidence to explain it in plain English when the questions start coming.
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Published on the EstateIQ Blog | By Jess Carrington, Trustee & Founder
Jess Carrington is a trustee and founder of EstateIQ, focused on building practical AI tools that support day-to-day estate management and compliance.