Guide to Society Maintenances Charges as Per Bye Laws
Society maintenance charges are regular fees collected from members for the upkeep and management of common areas and services within a housing society. These charges are governed by society bye laws and applicable laws, and understanding their calculation, legal framework, tax implications, and related notices is essential for society members and management.
What Constitutes Society Maintenance Charges?
Maintenance charges cover various expenses essential for keeping the housing society safe, clean, and functional. They directly affect residents’ living quality and include:
- Cleaning and Housekeeping: Costs for regular cleaning of common areas such as lobbies, corridors, and staircases. Often involves hiring professional staff.
- Security Services: Expenses for security personnel, gatekeeping, surveillance systems, and patrolling to ensure resident safety.
- Repairs and Maintenance: Routine upkeep of elevators, generators, water pumps, fire safety equipment, plumbing, electrical systems, and painting.
- Common Utilities: Electricity and water charges for shared spaces like streetlights, gym, clubhouse, and power backup facilities.
- Amenities Upkeep: Maintenance costs for amenities including swimming pools, gyms, sports facilities, and community halls.
- Administrative Expenses: Costs of managing the society, including staff salaries, office expenses, legal fees, and miscellaneous admin costs.
- Festival and Event Expenses: Charges for organizing cultural events and community gatherings, spread across members.
Maintenance Charges Summary Table
| Component | Description |
| Cleaning & Housekeeping | Regular cleaning of common areas |
| Security Services | Security staff and monitoring costs |
| Repairs & Maintenance | Fixes and upkeep of common equipment and areas |
| Common Utilities | Electricity, water, and power backup for shared areas |
| Amenities Upkeep | Swimming pool, gym, community hall maintenance |
| Administrative Costs | Salaries, legal, and office expenses |
| Festival/Event Charges | Expenses for society events |
Also Check: Apartment Maintenance Charges Rules and Regulations
Society Maintenance Charges As Per Bye Laws
Society bye laws define the framework for charging, collecting, and utilizing maintenance fees. They typically cover:
- Determination of charges: Based on flat size, usage, or equal distribution.
- Frequency of payment: Monthly, quarterly, or yearly intervals.
- Utilization: For upkeep of common areas, security, staff salaries, utilities, repairs, and administrative expenses.
- Revisions: Procedures for revising charges, generally requiring a committee decision or member approval.
By maintaining clear bye laws, societies ensure transparency and fairness in maintenance charges.
Society Maintenance Charges Act and Rules
The governing laws and rules vary by state but generally include:
- Registration and adherence to society acts (e.g., Maharashtra Co-operative Societies Act).
- Rules specifying how societies must maintain and account for maintenance funds.
- Regulations for fair notice, member rights, and dispute resolution related to maintenance charges.
Societies must comply with these laws to avoid legal issues and ensure smooth operations.
Different Types of Society Maintenance Charges
- Service Charges
These cover day-to-day operational expenses such as:
- Salaries of security, cleaning, and maintenance staff
- Utilities for common areas
- Upkeep of landscaping, playgrounds, and community halls
- Parking Charges
Fees for using parking facilities based on:
- Number of parking spots
- Vehicle type (two-wheeler or four-wheeler)
- Whether the space is reserved or open
- Non-Occupancy Charges: Additional fees for apartments owned but not occupied by the owner, typically when rented out.
- Sinking Fund: A reserve for major repairs or refurbishments like painting or elevator replacements. It prevents sudden heavy costs by spreading expenses over time.
- Property Tax Contributions: Collective payment of property tax to local authorities, simplifying compliance and sometimes reducing tax rates via bulk negotiation.
- Insurance Charges: Cover insurance premiums for risks like fire, theft, or natural disasters, protecting common property through collective funding.
- Lease/Rent Charges: Applicable when the society leases land or facilities from third parties; costs are shared by residents.
- Miscellaneous Charges: Include legal fees, special assessments, event expenses, or guest amenity costs.
Read Also: How to Reduce Society Maintenance Cost
Are Society Maintenance Charges Mandatory?
- Maintenance charges are generally mandatory, backed by society bylaws and local laws.
- Non-payment can lead to penalties or restricted access to amenities.
- Paying maintenance charges is essential for maintaining a harmonious living environment.
Supreme Court Judgement Highlights on Maintenance Charges
| Key Point | Explanation |
| All homeowners must pay maintenance charges | Charges apply regardless of occupancy status. The developer pays for unsold flats until sold. |
| No fixed formula | Societies can set charges but must ensure fairness for home purchasers. |
| Service charges vs expenses | Service charges cover common utilities and staffing; expenses cover repairs and maintenance. |
Determining Society Maintenance Charges: Criteria and Methods
Factors Influencing Charges:
- Property size
- Quality and number of amenities
- Location and cost of living
- Usage of common areas
- Operational expenses like staff salaries and utilities
Calculation Methods:
| Method | Description | Pros & Cons |
| Per Square Feet | Based on apartment size | Fair but complex |
| Equal Fee Approach | Same charge for all residents | Simple but may be unfair to smaller flats |
| Hybrid System | Base fee + variable charges based on size/use | Balances fairness and simplicity |
Payment Frequency
| Frequency | Description | Advantages | Challenges |
| Monthly | Most common and regular | Steady cash flow, manageable | Requires frequent accounting |
| Quarterly | Every three months | Balanced transaction frequency | Less immediate cash availability |
| Annually | One lump sum per year | Simplifies administration | Financial strain for some residents |
Financial Implications of Maintenance Charges for Residents
- Regular Commitment: Recurring expenses that must be budgeted.
- Affordability Impact: May affect residents with limited income.
- Property Value: Good maintenance can increase resale value.
- Participation: Residents tend to take a greater interest in society decisions affecting charges.
Non Payment of Society Maintenance Charges
Non-payment is a common issue and may result in:
- Imposition of penalties or interest on overdue amounts.
- Suspension of certain amenities or services for defaulters.
- Legal action including recovery suits as per society bye laws.
- Impact on the member’s credit rating within the community.
Societies usually send notices before taking strict actions to encourage timely payment.
Read More on: Non Payment of Society Maintenance Charges- Laws and Recovery
Calculation of Maintenance Charges in Society
Maintenance can be calculated using various methods:
| Method | Description | Common Use Case |
| Proportional to Area | Charges based on flat carpet or built-up area | Large societies with variable flat sizes |
| Equal Distribution | Same amount for all members | Small or homogeneous societies |
| Usage-Based | Charges proportional to services used (water, electricity for common areas) | Societies with metered utilities |
Example Excel Formula for proportional charges:
= (Flat Area / Total Area of all flats) * Total Maintenance Expenses
This allows accurate and transparent computation based on actual area owned.
Taxation on Society Maintenance Charges
Service Tax (Historical)
- Service tax was levied on maintenance charges before GST implementation.
- Now replaced by GST for uniform taxation.
GST on Maintenance Charges
- GST on maintenance charges are collected by housing societies.
- GST Rate: Usually 18% on the taxable value of maintenance services.
- GST is applicable on commercial portions but may be exempt or reduced on purely residential maintenance charges depending on local regulations.
- Societies must register for GST if turnover exceeds threshold limits.
TDS on Maintenance Charges Paid to Society
- Members may deduct TDS on maintenance charges under Section 194-IA or 194C if applicable when paying maintenance charges.
- Societies need to issue TDS certificates to members deducting TDS.
Summary Table: Tax Implications on Society Maintenance Charges
| Tax Type | Applicable To | Rate/Condition |
| Service Tax | Pre-GST period only | N/A (replaced by GST) |
| GST | Commercial & / or Residential | Typically 18% (subject to exemptions) |
| TDS | Maintenance paid by members | Deduct as per applicable sections |
Read Also: TDS in Housing Society
Society Maintenance Charges Notice Format
A proper notice format includes:
- Society name and address
- Member details
- Amount due and payment period
- Due date for payment
- Consequences of non-payment
- Contact details for queries
Sample lines:
“Dear Member,
This is a reminder that your society maintenance charges for the period [Month/Year] amounting to INR [Amount] are due on [Date]. Kindly ensure payment by the due date to avoid penalties.”
Letter Format for Society Maintenance Charges
Letters are used for formal communication regarding:
- Demand for payment
- Reminder for overdue charges
- Confirmation of receipt
Basic structure:
- Date and subject line
- Address the member by name
- State the purpose (e.g., payment request)
- Detail outstanding charges or confirmation
- Closing with society managing committee signature
Read Also: Society Maintenance Receipt Format
Simplify Society Maintenance Charges with NoBrokerHood
Understanding society maintenance charges helps residents and committees maintain transparency, ensure fair fees, and comply with legal norms. NoBrokerHood simplifies this process by enabling easy online payment, tracking, and GST compliance, making maintenance hassle-free for all.
Society Management Solutions by NoBrokerHood:
| Society Accounting Software |
| Society Management System |
| Visitor Management System |
| Boom Barrier |
| Apartment Management Software |
| Housing Societies |
FAQs
The society maintenance charge is imposed on a homeowner due to management, repair, and upkeep of the communal amenities such as water, electricity, elevators, gym, parking, property tax etc. within the apartment complex or cooperative society.
The managing committee of the society usually decides the maintenance charges as per the society bye laws and members’ approval if required.
Non-payment can lead to penalties, restricted access to society facilities, and legal action for recovery as per the society’s rules.
GST applicability depends on the nature of the society (commercial or residential) and local tax laws; generally, GST is charged at 18% on commercial maintenance charges.
Yes, if you receive a proper rent receipt from the society or landlord indicating the maintenance portion, you may include it in your HRA claim under income tax rules.
Society maintenance bills can be paid in cash, but it is especially important to keep a track of the receipts of transactions done, regardless of being online or offline.
Society maintenance charges vary from state to state, depending on the size of the apartment units as well as the number of amenities provided within the apartment complex.
It is quite easy to pay society maintenance bills online through either payment gateways or even society management apps that help pay using UPI, Net Banking, Credit/Debit Cards etc.
Yes, under the RERA Act 2016, the payment of the maintenance of the society is mandatory for homeowners within the society.