How to calculate society maintenance charges (with a worked example)
Maintenance is how a co-operative housing society pays for running the building. Each member's share is decided by the general body, within the society's bye-laws. Here is how most societies work it out.
What goes into a maintenance bill
A typical monthly bill in a Maharashtra co-operative housing society has these heads (your bye-laws may name them a little differently):
- Service charges: security, housekeeping, common electricity, lift maintenance, water pumps, office and audit expenses.
- Property tax and water charges, where the society collects them for the municipal corporation.
- Sinking fund and repairs and maintenance fund, the society's savings for major and regular repairs (see our guide to the two funds).
- Parking charges, non-occupancy charges for flats that are let out, and building insurance.
- Interest on overdue dues, at the rate the bye-laws allow.
Three ways to share the cost
Equally per flat. Services such as security and housekeeping benefit every flat about the same, so the Maharashtra model bye-laws share service charges equally among all flats.
By area. Costs that grow with the size of a flat — property tax, and the sinking and repairs funds, which are worked out from each flat's construction cost — are usually charged by area.
A mix. Most societies combine the two: equal service charges plus area-based funds and taxes. Shops, offices and bungalows can carry different rates where the bye-laws allow it.
A worked example
A society has 48 flats: 24 of 650 sq ft and 24 of 950 sq ft. Its monthly running costs are security ₹60,000, housekeeping ₹24,000, common electricity ₹18,000, lift maintenance ₹6,000, office and audit ₹4,000, and water pumps and tankers ₹8,000: ₹1,20,000 in all, or ₹2,500 per flat shared equally.
The general body has fixed the sinking fund at 0.25% and the repairs fund at 0.75% of each flat's construction cost a year, taking construction at ₹2,000 per sq ft:
| 650 sq ft flat | 950 sq ft flat | |
|---|---|---|
| Construction cost | ₹13,00,000 | ₹19,00,000 |
| Service charges | ₹2,500 | ₹2,500 |
| Sinking fund (0.25% a year) | ₹271 | ₹396 |
| Repairs fund (0.75% a year) | ₹813 | ₹1,188 |
| Monthly maintenance | ₹3,584 | ₹4,084 |
Property tax and water charges are added at actuals for each flat.
Good habits
- Decide the rates in a general body meeting and record them in the minutes.
- Publish the rate card so every member can see how their bill is made up.
- Compare the year's actual expenses with collections at every AGM and revise if needed.
- Keep the sinking and repairs funds separate from day-to-day money.
How myNest helps
Set your charge heads once — per flat, per sq ft or fixed — and myNest raises the month's bills for every flat, bungalow, shop and office together. Interest on overdue bills is added after the grace period, and every resident sees their own ledger. See the maintenance features.
This guide is general information, not legal or tax advice. Your society's registered bye-laws and your chartered accountant have the final word.
Frequently asked questions
Can a society charge bigger flats more?
For service charges, Maharashtra's model bye-laws share them equally per flat. Area-based amounts apply to items like property tax and the sinking and repairs funds. Your society's registered bye-laws decide.
Can tenants be charged extra?
A society may levy non-occupancy charges on let-out flats. In Maharashtra these are capped at 10% of the service charges, excluding municipal taxes, under a government order of 2001.
Is GST payable on maintenance?
Only above certain limits. See GST on society maintenance.