How to Calculate Non Occupancy Charges?

As far as I know, the sum cannot surpass 10% of the service charges for the computation of non-occupancy charges. Service fees cover expenses for the society office, block employees' salaries and benefits, etc. I have shared the detailed process on how to calculate non occupancy charges below for you.

Non Occupancy Charges Calculation Steps

To find out the non-occupancy charges in India, you can follow these steps:

• Identify the total service charges levied by your housing society. If you don't know about service charges, these charges include salaries for society employees, stationery costs, overhead expenses, and utility charges (excluding municipal taxes).

• Calculate 10% of service charges. Non-occupancy charges are ‌calculated as 10% of the applicable service charges. For example, if the total service charges for a month are Rs. 2,500, the non-occupancy charges would be Rs. 250 (10% of 2,500).

• Verify the specific bylaws of your housing society, as the percentage and calculation method may vary. Some societies may have different rates or additional clauses.

Note that non-occupancy charges are not applicable if the owner or their immediate family members (e.g., parents, siblings) occupy the property. I hope you found this helpful.

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What are Common Area Maintenance Charges?

Housing societies impose non-occupancy fees on individual flat-owners who don't really live in their individual properties. Non-occupancy charges are assessed when the apartment is not self-occupied or occupied by a person of a close family and the flat-owner utilises the property for financial purposes. I have been paying non-occupancy charges for years and I think it’s mandatory to pay it. There are times when I thought of not paying it, but then with time, I realised its real intentions. The non-occupancy charges are included in the monthly payment for maintenance. You don’t have to pay the fees if the property is not rented and stays closed, or if the unit is kept by a family member such as a spouse or parent. Let’s see how to calculate non occupancy charges.

Calculation of non occupancy charges in housing society:

The amount of non-occupancy costs cannot exceed 10% of the society's service charges, according to a notification issued by the Maharashtra government under Section 79A of the Maharashtra Cooperative Societies Act, 1960. (excluding municipal taxes).

For example, imagine a society's entire maintenance price for a member is Rs 4000, which includes Rs 3000 in additional fees. The society will then charge a non-occupancy fee of Rs 300, which is 10% of the total rent of Rs 3000. So you have to pay Rs.300 as non-occupancy charges to the respective society on a monthly basis.

Criteria of non-occupancy charges:

1) When a property owner lives in the property, he is not responsible for paying non-occupancy fees to society.

2) If the members of the family, such as son, daughter (married or single), or grandkids live in the property, then also non-occupancy charges are exempted.

3) When a person's property is provided on leave and licence or becomes unoccupied, a society can collect non-occupancy fees.

4) Non-occupancy fees cannot be more than 10% of the housing society's monthly service fees.

What if the property owner doesn’t pay the non-occupancy charges?

If a flat owner refuses to pay non-occupancy charges, the housing society will send a message to the owner. Over time, if the owner continues to neglect his/her property, society may declare that owner a defaulter. In addition, society will not issue a certificate of non-dues.

Now you know how to calculate non occupancy charges.