At the ordinary annual general meeting, the co-owners of a building validate and vote on a provisional operating budget for one year. This budget will allow the Management Company to ask each owner to pay provisions for charges, based on the amount of this budget according to their ownership percentage (determined by the nature of their lot and the co-ownership regulations).
At the end of the accounting year (after 12 months), the Management Company closes the current management accounts and proceeds to pay expenses: this operation consists of differentiating between the expenses actually spent by the Management Company and the charges you paid under the estimated budget voted 12 months earlier.
At this stage, there are two possibilities:
- You have paid too much: if the cumulative amount of your provisions for expenses is greater than the actual amount of expenses, you will be “reimbursed”. In practice, the Management Company subtracts this amount from your first payment for the following year.
- You have not paid enough charges: in this case, you will have to pay the missing sum to the residents association. The Management Company will add this amount to your first payment for the following year.
Only expenses related to provisions for expenses will be subject to an adjustment of charges. These include costs established in the estimated budget: maintenance of common areas and green spaces, maintenance of all facilities, salary of the caretaker or day-to-day administration of the building.
Mandatory regularisation of service charges occurs once per year. To help you better understand the charges, the Management Company sends each co-owner a statement of expenses.